Employee vs. Independent Contractor. When is an Employer Responsible for Negligence?

nyc_taxi_taxi_berlin-1024x768Often people are injured by a person who appears to be an employee of a company. However, just because someone seems to be working for a business doesn’t necessarily mean they are an employee. If you’re hurt by an employee of a company and want to seek damages, whether the person is an employee or an independent contractor could make a big difference in your case. The following case explains the difference between an employee and an independent contract for determining who will be liable for the injured party’s claims. 

In January 2013, a cab driver was involved in a crash in Shreveport, Louisiana, where the cab passenger, Ms. Franklin, was injured. The cab driver, Mr. Gary Dick, leased the taxicab from Crawford and Yellow Checker Cab Company each day for $85. However, Mr. Dick kept all proceeds from his driving, and the cab companies received the same $85 a day regardless of how much Mr. Dick made. As a result, Ms. Franklin filed a lawsuit against Dick, Crawford, and the Yellow Checker Cab. Filing a lawsuit against all the possible defendants who may be liable is customary after an auto accident, as before litigation Ms. Franklin would have no way of knowing whether or not Dick was an employee or an independent contractor.

The cab companies filed a partial summary judgment motion arguing that there was no employee/employer relationship between themselves and Mr. Dick. Therefore, if successful, the cab companies would not be liable to Franklin for any of her injuries caused by the car accident, only Dick would. The trial court granted the motion in favor of the cab companies, and Franklin appealed the ruling.

The appeals court began its analysis with the Louisiana statute La C.C. art. 2320. The law states, “Masters and employers are answerable for the damage occasioned by their servants and overseers in the exercise of the functions in which they are employed.” Whether a person is, an employee or an independent contractor is determined on a case-by-case basis. 

Courts will examine a variety of factors in each case to determine if a person was an employee or an independent contractor. A significant factor reviewed by the Courts in Louisiana is whether the employer has the right to control a person’s work. The Supreme Court of Louisiana set forth the following factors to consider when making this determination: 1)whether there is a valid contract between the parties; 2) the work being done is of an independent nature such that the contractor may use nonexclusive means in accomplishing it; whether the contract calls for work to be done according to the independent contractor’s methods, without being controlled or directed by the principal; 4) whether there is a specific price for the job being agreed on; 5) the duration of work is for a specific time and is not subject to termination at will by either the employer or contractor without liability for its breach. Hickman v. Southern Pac. Transport Co., 262 La. 102, 262 So.2d 385 (1972). 

The appeals court, in this case, found that Mr. Dick was an independent contractor. This was because Dick entered into a lease for the cab for $85 a day and used his means to get customers for his driving. Additionally, Mr. Dick had no set working hours and was free to work as much as he wanted or not pick up passengers. The cab company also did not receive any money from Mr. Dick’s fares throughout the day. The cab company also could not fire Mr. Dick but could only refuse to lease him the taxi cab. Thus while there was a valid contract between Mr. Dick and the company, Mr. Dick was not controlled by the taxi cab company and could not be terminated by the company. The court found that these factors weighed in favor of finding that Mr. Dick was an independent contractor and not an employee of the cab company. Thus the court found that the cab company could not be held vicariously liable for Ms. Franklin’s injuries. 

This case demonstrates the consequences of how a person performing work is classified in the personal injury context. Employers are held liable for the actions of their employees, while they are not held responsible for the actions of an independent contractor. Ms. Franklin will not be able to recover from the cab companies. However, her claims against Mr. Dick will continue. An experienced personal injury lawyer will be able to guide you through the litigation process to ensure you understand the intricacies of litigation.


Written by Berniard Law Firm Blog Writer: Corbin Niese

Additional Berniard Law Firm Articles on Employer Negligence: How Can An Employer Make Sure They Are Only Covering Their Employees Negligence?

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