Construing Kentucky’s “up-the-ladder” statutory employer framework, a state appellate court recently reiterated that workers' compensation immunity is extended to contractors—those who contract with another to have work performed of a kind that is a “regular or recurrent part of the work of the trade, business, occupation, or profession of such person” [Ky. Rev. Stat. Ann. § 342.610, emphasis added]. Moreover, the court added that to be “regular,” the “contractor” need never to have utilized its own employees to provide the relevant service. Accordingly, where a pork processing facility operator contracted with a second firm to perform specialized sanitation services at the facility, the latter firm's employee was the statutory employee of the operator and could not sue the pork processor in tort for injuries sustained in the course and scope of his sanitation duties.
Cabrera sustained a serious injury to his right arm while sanitizing saddle tables in a Louisville pork processing facility. His immediate employer was Packer's Sanitation Services, Inc. (“Packers”), a company that specializes in providing sanitation services that ensure meat processing facilities comply with a multitude of state and federal regulations. Packers had entered into a contract with JBS, the company that operated the pork processing facility, to provide necessary sanitation services. Cabrera filed a workers' compensation claim and received benefits. He then asserted several negligence and products liability claims against various defendants, including JBS. After a period of motion practice, his claims were summarily dismissed.
Was JBS a “Contractor”
The issue in the case was whether JBS enjoyed “up-the-ladder” immunity as a statutory employer. In Kentucky, like the majority of states, tort immunity under the Act extends "up the ladder" from the subcontractor that employs an injured person to the entities that contracted with the subcontractor, so long as the injured person's employer has workers' compensation coverage, and the up the ladder entities contracted “to have work performed of a kind which is a regular or recurrent part of the work” of their business.
Had JBS Ever Performed the Relevant Type of Work?
Cabrera argued that JBS was not a protected contractor because it had never performed the particular type of work with its own employees and it had no employees skilled enough or trained to do it. The appellate court said that wasn’t dispositive. The services provided by Packers were regular and they were recurrent. Parenthetically, they were actually required by law. Quoting Fireman's Fund Ins. Co. v. Sherman & Fletcher, 705 S.W.2d 459, 461 (Ky. 1986), the court stressed that persons or entities who engage another to perform a part of the work that is a recurrent part of their business, trade, or occupation are considered “contractors” under the Act, even if they never perform that type of work with their own employees.