ISSUE: Part time exposure?

It’s a common situation.  Mixed duty workers spend part of their time doing maritime work, and they spend the rest of their time, maybe even the majority of their time, doing non-maritime work.  The employer wants to know why he is paying Longshore Act rates (which we all agree are usually higher than state act rates) for non-maritime work.  It’s a fair question, and there is an answer.  Part time maritime work equals full time Longshore Act exposure.

But sometimes I say to myself, “Maybe I overdo it when I say that, in my opinion, there is no such thing as part time exposure under the Longshore Act”. 

But there is clear support for this position.  It has long been the opinion of the U.S. Department of Labor, which administers the Longshore Act, and there is support at all levels of the case law for the principle that regular, part time maritime duties equal full time Longshore Act exposure with regard to the “status” of the employee.  Note:  This is a “status” issue.  We are assuming that these workers are on a covered “situs”.

Let me put it this way.  The principle is that an employee who performs maritime duties as any part of his regularly assigned duties is a maritime employee covered by the Longshore Act.  And it doesn’t matter how small a part; there is no minimum portion required.  Even if only two percent of regular duties are maritime related, you’ve got a one hundred per cent maritime employee covered by the Longshore Act.  And, there is no moment of injury test.  It doesn’t matter that at the moment of injury the employee was performing non-maritime duties.  He’s a maritime employee covered by the Longshore Act.

The principle goes back to before the 1972 amendments, when the only test for coverage was situs; you had to be injured over the navigable waters of theUnited Statesor on a dry dock.  Waterfront workers walking in and out of coverage presented employers with a problem.  You can see why.  This was before containerization and fabrication processes moved much of the stevedoring and shipbuilding work on to land.  Most of the work was still being done over the water, and workers’ compensation insurance coverage changed from state to federal each time the worker passed back and forth across the Jensen Line at the water’s edge.

This concern was one of the reasons for the 1972 amendments’ shift in coverage landward to certain enumerated sites and to “other adjoining (maritime) areas”.  The concept of “status” was created.  A series of Supreme Court decisions based on the Constitutional principle of maritime uniformity and the Congressional concern with the walking in and out of coverage problem made clear that in order to meet “status” for Longshore coverage the worker did not have to be engaged exclusively in maritime work and did not have to be engaged in maritime work at the moment of injury.

The Supreme Court in Northeast Marine Terminal Co., Inc. v. Caputo, 432 U.S. 249 (1977) described covered employees as “persons whose employment is such that they spend at least some of their time in indisputably longshoring operations.”  The “status” analysis for Longshore Act coverage must consider all of the worker’s regularly assigned duties.  If any portion of these regularly assigned duties is maritime in nature, then that worker is covered by the Longshore Act.  When you consider this along with the principle that there is no “moment of injury” test for coverage, then the conclusion is that there is no part time Longshore worker.

This proposition has been tested repeatedly and confirmed.  In the process, it has been established that there is no minimum maritime component of regular duties required.  As little as 1 or 2 percent of regular maritime duties can yield a full time Longshore Act worker.

To some employers, and their brokers, this is not a logical concept.  To some, it is not a rational concept.  To most, it is unpopular.  But the development of the case law is clear.  And remember the concerns that are being addressed.  The U.S. Constitution requires national uniformity in maritime matters.  The federal Longshore and Harbor Workers’ Compensation Act covers maritime workers.  It would be inconsistent with the purpose of the Act if some indisputably maritime workers were excluded.  Workers walking in and out of coverage during the workday present a problem for employers and their insurance carriers, and the Act should be interpreted to avoid this whenever possible.  So, all workers with maritime duties should be covered, and for their full employment. 

Note:  This discussion concerns the “status” of the worker.  The issue of “situs” can also have a part time component since the site of the injury does not have to be used exclusively for maritime purposes.  That discussion is for another day.  Until then, both “status” and “situs” have to be separately satisfied for coverage under the Longshore Act.

ISSUE: Divers

What about divers?  Are they covered by the Longshore Act or are they crewmembers under the Jones Act and general maritime law?

As usual, many coverage questions produce conditional opinions, and the best you can come up with is a best guess at a most likely outcome.   

But questions with regard to divers tend to be even more difficult than usual.  You could say that their duties and circumstances of employment are diverse.  There’s a broad spectrum of employment ranging from land based dock building and repair, to harbor based maintenance and ship repair, to the largest offshore oil and gas operations, and back to inland industrial storage tank and reservoir work and over to self-employed independent contractors hired temporarily for their specific expertise.  One end of the spectrum is land based Longshore Act workers’ compensation and the other end is Jones Act service to a vessel.  But there’s a large middle ground.

To review the tests for coverage:

The Longshore Act contains a status and situs requirement.  You must be engaged in maritime employment involving shipbuilding, ship repair, ship breaking, or the loading or unloading of cargo, or any activity integral to those operations.  This includes constructing, repairing and maintaining the buildings and equipment used in these operations.  There is no moment of injury test.  Any regular part of a worker’s duties that is maritime in nature confers full time Longshore Act status.

The Longshore Act also contains a separate situs provision.  The injury must occur over the navigable waters of the United States, or on any adjoining pier, wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by an employer in maritime employment.  Situs is determined as of the moment of injury.

There is a two part test for Jones Act crewmember status:  the worker must contribute to the mission or function of the vessel, and he must have an employment relationship to a vessel or fleet of vessels under common control that is substantial in terms of both nature and duration.

The two coverages are mutually exclusive since the Longshore Act explicitly excludes Jones Act seamen and the Jones Act only covers seamen, but as we have seen, a large “uncertainty zone” between the Acts causes an overlap where coverage questions constantly arise.

As one judge put it, “It is impossible to define the phrase ‘member of a crew’ in general terms:  the words are colloquial and their fringe will always be ragged.  Perhaps the best hope is that, as the successive variants appear, they will finally serve rudely to fix the borders”, (Hawn v American S.S. Co., 107 F.2^nd 999 (2^nd Cir. 1939)).  This is quoted from a 1939 decision, and we are still fixing the borders.

Many divers actually have mixed duties.  When they are not diving they are performing other tasks such as loading/unloading, maintenance, repair, etc. This makes it very difficult in the broad middle of the employment spectrum to predict whether you have a Longshore Act or a Jones Act exposure.

First, let’s remove some divers from the Longshore Act on the basis of situs.  Large water tanks under industrial facilities, sewage treatment plants, land locked reservoirs, etc. are not navigable waters of the U.S. (and probably not “other adjoining areas”).  So, no Longshore Act coverage (and for the same reasons, probably not Jones Act).

The diver who works from land in dock and pier construction and repair is most likely a harbor worker covered by the Longshore Act.

The diver who works from barges or floating work platforms engaged in the construction and repair of land based marine facilities is probably still covered by the Longshore Act, although we are getting further along the spectrum toward the Jones Act.

The diver who works in a harbor from a vessel doing such things as building artificial reefs, maintaining and repairing buoys and markers, and inspecting vessels is further down the spectrum and has probably just gone past the middle into Jones Act coverage.

The diver who lays underwater cable from a cable laying vessel, or who works off a floating platform in oil and gas exploration and production is most likely on the Jones Act crewmember side.

Frequently, it comes down to the nature of the worker’s relationship to a vessel (remember the test is a relationship that is substantial in terms of nature and duration).  In an attempt to simplify the analysis and application of the coverage tests, the courts frequently use a 30% rule of thumb.  If the worker spends less than 30% of his total work time on the vessel then he is probably not a Jones Act crewmember.  This usually includes time spent traveling to and from the vessel, and these close cases always involve a detailed accounting of the worker’s time.

The crucial issue in cases involving divers frequently seems to be the “substantial employment relationship to a vessel in terms of duration” portion of the two part test.  The “contribute to the mission or function of the vessel” and the “substantial employment relationship to a vessel in terms of nature” are the easy parts for the typical diver.

In view of the relatively short length of many diving contracts, there is a suggestion that the courts will relax the “substantial duration” test somewhat for divers.  One federal circuit has held that 10 days is not too brief to constitute substantial duration as a matter of law, and another has affirmed that 4 weeks satisfies the substantial duration test.  For the “substantial duration” part of the test, the 30% rule is important.    

Due to the uncertainty inherent in many coverage issues involving divers, the bad news is that maritime employers often find themselves fully insuring workers separately under two mutually exclusive statutes.  Nonetheless, it is a good idea to carry both coverages in any uncertain situation to be on the safe side.

ISSUE: Coverage – Status

Review

Section 902(3) of the Longshore Act is the “STATUS” coverage provision.  It states, “The term ‘employee’ means any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, and any harbor worker including a ship repairman, shipbuilder, and ship breaker ….”

Section 903(a) is the “SITUS” coverage provision.  It states, “… compensation shall be payable under this Act in respect of disability or death of an employee, but only if the disability or death results from an injury occurring upon the navigable waters of the United States (including any adjoining pier, wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by an employer in loading, unloading, repairing, dismantling, or building a vessel).”

So, to be covered by the Longshore Act an injury must occur upon the navigable waters of the United States, including dry docks, or on a landward area covered by the situs provisions of section 903(a) if the work is maritime in nature under the status provision of section 902(3).  Both the “status” and the “situs” tests must be met.

One point to keep in mind is that not every worker on a covered situs is covered by the Longshore Act.  The “status” test must also be met.  At any given time, there are many, many workers engaged in numerous occupations employed at shipyards, port areas, and “other adjoining areas” that meet the “situs” test.  How can we tell if these workers also meet the “status” test for Longshore Act coverage?

The U.S. Department of Labor’s Benefits Review Board recently published a helpful decision in the case of a nurse employed by a large shipyard (Lucille Galinas v. Electric Boat Corporation, BRB No. 10-0422, 11/23/2010).  The employee met the situs requirement because she worked at the shipyard.  Her duties consisted of treating injured employees in the employer’s medical clinic, responding to ambulance calls in the shipyard, performing physical examinations, audiograms, and EKGs, stocking RADCON (radiological control) supplies, and participating in RADCON training drills.  Is she covered by the Longshore Act?

The test is whether the employee’s duties are “integral” (essential) to the employer’s shipbuilding process.  Would the employee’s failure to perform these duties impede the employer’s shipbuilding activities?  Of course, evaluating the degree of the impediment is where the difficulty comes in.  In the range from mildly inconvenient to grinding to a halt there is lots of room for a thin line to meander.

In considering this case, the Board cited several examples from the case law.  There was the courtesy van driver who transported workers and visitors around a marine terminal.  He failed the integral test for status.  Then there was the cook at a mess hall on a wharf.  He also failed the integral test.  Then there were the janitors who cleaned restrooms, offices, and the cafeteria in a shipyard.  These workers also failed the integral test.  Finally, there were the workers’ compensation claims adjustors, who also failed to meet the “integral” test for status.

Not mentioned by the Board in its discussion were the cases of the maintenance workers who did not clean peripheral areas such as offices and restrooms, but who cleaned and maintained shipbuilding equipment or shipyard production areas, such as the workers who changed shipyard air conditioning filters or picked up trash around the shipyard production facilities.  These workers satisfied the integral test, since the failure to perform these duties would directly and proximately cause impediments in the shipbuilding activities in the form of work stoppages or interruptions in the shipbuilding process.

You can see that the test is not exactly stark.  Somewhere in the duties of these workers their work either crosses the “integral” line or it doesn’t.  Their work is useful to the employer on one side of the line, or essential to the employer on the other.

So, does the shipyard’s occupational health nurse satisfy the status test for coverage? 

No.  Not on the facts in this case.

ISSUES – “PERINI” Coverage

You’ve probably seen references to so-called “Perini” coverage when the issues of situs and status under the Longshore Act are being discussed.  I make frequent reference to it myself, usually assuming that others know what I’m talking about.

The reference is to the U.S. Supreme Court’s 1983 decision in the case of Director, Office of Workers’ Compensation Programs v. Perini North River Associates (Churchill), 459 U.S. 297. 

It’s probably overdue, but now I’ll take a few minutes to discuss what “Perini” coverage is.

Let’s start at the beginning.  When the Longshore Act was enacted in 1927, and up until the 1972 amendments, coverage under the Act was determined by the situs of the injury.  If a worker suffered a work related injury over the navigable waters of the United States, or on a dry dock, he was covered, unless excluded by one of the express statutory exclusions, such as “master or member of a crew of any vessel”.  If the worker was working over the water in the course of employment, regardless of what his job was, he was covered by the Longshore Act.

The 1972 amendments expanded coverage landward, “upon the navigable waters of the United States (including any adjoining pier, wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by an employer in loading, unloading, building, or repairing a vessel)”.

The 1972 amendments also added a “status”, or maritime employment, requirement to limit coverage to only maritime employees in the newly expanded “situs”.

So the question arose: is a worker injured over the navigable water who would have been covered prior to the 1972 amendments no longer covered unless he can establish that he meets the new “status” requirement?

In Perini the Supreme Court held that Congress, in the 1972 amendments, did not intend to withdraw coverage from any worker who would have been covered prior to the amendments.  This is regardless of occupation.  If you are injured in the course of employment over the navigable waters of the United States, or on a dry dock, then you are covered by the Longshore Act.  There is no “status” test.  This is “Perini” coverage.

There are two issues to be alert to.  If you are expressly excluded from coverage by a statutory provision, such as the coverage exclusions in section 902(3) added by the 1984 amendments, then you are not eligible for “Perini” coverage.

Also, in the federal circuit courts of appeal there are varying interpretations of the issue of whether the worker was over the navigable water “transiently or fortuitously” when injured and what this might mean with regard to coverage.  This is a factual issue, and the result may vary by circuit. 

But the main point is, if you are injured over the navigable water, and your regular job duties require you to be there, and you are not excluded by a specific statutory exclusion, then you are covered by the Longshore Act.  There is no “status” test under “Perini”.