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Ex parte Tenax Corporation and Tenax Manufacturing Alabama, LLC

Supreme Court of Alabama

January 27, 2017

Ex parte Tenax Corporation and Tenax Manufacturing Alabama, LLC
v.
Tenax Corporation; Tenax Manufacturing Alabama, LLC; Onin Staffing, LLC; and Tenax SPA (Italy) In re: John Dees

         Conecuh Circuit Court, CV-15-900036

          PETITION FOR WRIT OF MANDAMUS

          MAIN, Justice.

         Tenax Corporation ("Tenax") and Tenax Manufacturing Alabama, LLC ("Tenax Alabama"), petition this Court for a writ of mandamus directing the Conecuh Circuit Court to enter a summary judgment in their favor in John Dees's tort action against them. Tenax and Tenax Alabama contend that they are immune from Dees's tort claims under the exclusive-remedy provisions of the Alabama Workers' Compensation Act, § 25-5-1 et seq., Ala. Code 1975. Additionally, Tenax Alabama contends that it is entitled to a summary judgment because it was not a legal entity when Dees was injured. We grant the petition and issue the writ.

         Facts and Procedural History

         Tenax owns a plant in Evergreen that makes plastic netting and other plastic products. Dees worked at the plant for about six months in 2010 and again for about two months in 2013. Dees went back to work at the plant in July 2014, but, at the direction of the plant's general manager, Dees had applied to Onin Staffing, LLC ("Onin"), for the job at the Tenax plant. On January 14, 2015, while operating a machine, Dees suffered significant injuries to his left arm.

         In December 2015, Dees sued Tenax, Tenax Alabama, Tenax SPA (Italy) (a foreign corporation doing business in Conecuh County), [1] Onin, and fictitiously named defendants claiming that, while he was operating a machine at the plant as instructed and according to proper procedures, he was injured as a result of the alleged defective condition of the machine. Dees sought workers' compensation benefits from Onin, and he sought damages under the Alabama Extended Manufacturer's Liability Doctrine ("AEMLD") and for negligence and wantonness from the other defendants. In their answer, Tenax and Tenax Alabama asserted the immunity defense under the Alabama Workers' Compensation Act and then moved for a summary judgment on that same ground. Tenax Alabama also claimed that it was entitled to a summary judgment because it did not exist as a legal entity at the time of Dees's injury on January 14, 2015.

         According to Dees's complaint, in January 2015 he was employed by Onin and, at the time of his injury, "was acting within the line and scope of his job duties and responsibilities with Defendant Onin." However, Dees testified in deposition that in January 2015 his understanding was that he was employed by Tenax and that Onin was a "temp agency." Dees further testified that "if I fill out an application [asking for the name of my employer], I don't put Onin Staffing, I put Tenax." According to Dees, Tenax trained him, supervised him, took any necessary disciplinary actions against him, and controlled his work. Dees also submitted his work hours to his supervisor at Tenax, and Dees received and signed for a Tenax employee handbook. Onin never placed Dees in any job other than the job at the Tenax plant.

         Melvin Owens, the general manager for the Tenax plant, testified that Tenax had a relationship with Onin whereby Onin supplied Tenax with temporary labor. To pay the workers supplied by Onin, Tenax would write Onin a check, and Onin in turn would withhold appropriate taxes and other items and issue a check to the workers. In 2014, Dees, who had worked for Tenax as a permanent employee on two previous occasions, approached Owens and asked for a job. Owens agreed to hire Dees but instructed him to go to Onin to "process it through, " which Dees did. During this third stint with Tenax, Dees worked full-time, but he was on probationary status and did not receive benefits from Tenax. During his third stint, Dees was fired by Tenax in September 2014, but he was rehired about a month later. When Dees was injured, Tenax prepared an accident report. Owens testified that he considered Dees "to be a Tenax employee like any other Tenax worker in the Evergreen plant" at the time he was injured.

         Christa Mrachkovskiy, Onin's director of safety and risk management, testified in deposition that Onin is a "temporary agency" that provides workers and that Onin "broker[s] the relationship between a worker and [Onin's] client, or the business providing employment to the worker, " much like "Manpower or Labor Finders and other temporary agencies." According to Mrachkovskiy, Onin charges a business an hourly rate, "say, $15 an hour. The worker may get $10, and the remaining $5 goes to for [sic] like workers' compensation premiums, general liability premiums, health insurance, et cetera." Mrachkovskiy testified that Onin performs "ministerial duties, " such as "paying the worker, taking out for workers' comp, taking out general liability insurance, taking out for health insurance, " and withholding taxes. Onin also conducts criminal background checks and drug screenings. According to Onin's "proposal for staffing services" between Onin and Tenax:

"As the employer, Onin Staffing assumes all of the responsibility for personnel administration. These responsibilities include the withholding of taxes, payment of wages, employer contributions for FICA, Federal and State Unemployment taxes, and providing insurance for occupational injuries, and general liability insurance coverage up to $1, 000, 000 per incident, $2, 000, 000 aggregate."

         Onin did not provide any training to Dees other than showing him a short video concerning general safety, which is shown to all workers supplied by Onin. According to Mrachkovskiy's deposition testimony, at some point Dees signed a document that stated, in part: "I understand that I am an employee of Onin Staffing. Only Onin Staffing or I can terminate my employment. I also understand that I have exactly one (1) business day to report back to Onin Staffing for further job assessment and that potential unemployment benefits may be denied to [me] for failure to do so." Under Onin's policies concerning injuries sustained by their employees in the workplace, employees were required to report any work-related injury to their field supervisor immediately and to Onin before the end of the shift during which the employee was injured. Along with Tenax, Onin investigated Dees's accident. Mrachkovskiy testified that she considered Dees to be a dual employee of Onin and Tenax.

         It is undisputed that Tenax and Tenax Alabama merged in December 2014. Tenax was the successor entity, and Tenax Alabama ceased to exist as a legal entity before Dees was injured.

         After conducting a hearing and reviewing the cases upon which the parties relied, the trial court denied Tenax and Tenax Alabama's motion for a summary judgment.

         Discussion

         I.

         Concerning the claims against Tenax Alabama, it is undisputed that Tenax Alabama was not a legal entity at the time Dees was injured. In his answer to the mandamus petition, Dees "concedes that the trial court should have granted Defendant Tenax Manufacturing Alabama, LLC's Motion for Summary Judgment. This issue was uncontested at the trial court level by Plaintiff Dees." Dees's ...


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