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Employers; evasion of law; what constitutes; exceptions.
person, firm, or corporation creating or carrying into operation any
scheme, artifice, or device to enable him or her, them, or it to
execute work without being responsible to the workers for the
provisions of the Nebraska Workers' Compensation Act shall be included
in the term employer, and with the immediate employer shall be jointly
and severally liable to pay the compensation herein provided for and be
subject to all the provisions of such act. This section, however, shall
not be construed as applying to an owner who lets a contract to a
contractor in good faith, or a contractor, who, in good faith, lets to
a subcontractor a portion of his or her contract, if the owner or
principal contractor, as the case may be, requires the contractor or
subcontractor, respectively, to procure a policy or policies of
insurance from an insurance company licensed to write such insurance in
this state, which policy or policies of insurance shall guarantee
payment of compensation according to the Nebraska Workers' Compensation
Act to injured workers.
- Laws 1913, c. 198, § 16, p. 584;
- R.S.1913, § 3657;
- C.S.1922, § 3039;
- C.S.1929, § 48-116;
- R.S.1943, § 48-116;
- Laws 1986, LB 811, § 35.
1. Scheme, artifice, or device2. Carrying of insurance3. Effect of election4. Miscellaneous1. Scheme, artifice, or device
was no evidence in this case that the contract between the parties that
controlled their relationship was a sham to conceal the true
arrangement of the parties. Spulak v. Estep, 216 Neb. 523, 344 N.W.2d
- School (an owner of property on which the work is performed) was not liable as a statutory employer by virtue of section 48-116where the work being done by the independent contractor would not
ordinarily be done by employees of the owner in view of the owner's
past practices and the practices of employers in comparable businesses,
regardless of whether the owner's employees could have done the work.
Overruling a portion of Sherlock v. Sherlock, 112 Neb. 797, 201 N.W.
645 (1924). Franklin v. Pawley, 215 Neb. 624, 340 N.W.2d 156 (1983).
- Dealer's agreement for sale of
seed corn was not an arrangement to evade provisions of Workmen's
Compensation Act. Bohy v. Pfister Hybrid Co., 179 Neb. 337, 138 N.W.2d
- Burden is on workman to prove by
a preponderance of evidence that employer set up a scheme, artifice, or
device to defeat provisions of workmen's compensation law. O'Brien v.
Barnard, 145 Neb. 596, 17 N.W.2d 611 (1945).
- Owner of residence, who employs
workman to remodel and move it, is not an employer within the Workmen's
Compensation Act, even though the sole income of the owner is derived
from rental of property. Retzlaff v. Dickinson, 141 Neb. 136, 2 N.W.2d
- Where liability would not attach
if employment was direct, proviso constituting as employer person using
scheme, artifice, or device to escape responsibility does not apply.
McConnell v. Johnston, 139 Neb. 619, 298 N.W. 346 (1941).
- Where city furnished materials
and equipment for a W.P.A. project, but had no authority to control the
details of the work or to direct the mode and manner of doing it, the
arrangement did not constitute a device to enable the city to execute
work without being responsible. Williams v. City of Wymore, 138 Neb.
256, 292 N.W. 726 (1940).
- Scheme, artifice, or device do
not necessarily imply fraud, and agreement of independent contractor to
protect corporation employing him from liability for injuries to
employees is a device. Sherlock v. Sherlock, 112 Neb. 797, 201 N.W. 645
2. Carrying of insurance
- A statutory employer is a
principal who employs a scheme, artifice, or device to avoid workmen's
compensation law. Petznick v. United States, 575 F.Supp. 698 (D. Neb.
one employs an uninsured contractor, he becomes an employer under the
terms of the Workmen's Compensation Act, and is entitled to the
protection of the provisions thereof as to what acts are covered and
what are not. Wilbur v. Adams Lumber Co., 140 Neb. 48, 299 N.W. 268
- The liability of a third party
for failing to require a contractor to carry compensation insurance is
an imputed one, and separate notice of accident and claim for
compensation from that given to contractor is not required. Dobesh v.
Associated Asphalt Contractors, Inc., 138 Neb. 117, 292 N.W. 59 (1940).
- An unperformed agreement by
contractor to carry compensation insurance does not relieve owner from
liability. Hiestand v. Ristau, 135 Neb. 881, 284 N.W. 756 (1939).
- Owner of building, used in
conducting owner's business, who contracts with contractor for certain
repairs to said building is an employer within the terms of statute
unless it be shown that the contractor was required to procure
compensation insurance for protection of his employees. New Masonic
Temple Assn. v. Globe Indemnity Co., 134 Neb. 731, 279 N.W. 475 (1938).
- Owner of building used in
conducting owner's business who enters into contract with contractor
for certain repairs is an employer within meaning of law unless it be
shown that the contractor was required to procure compensation
insurance for protection of his employees. Jones v. Rossbach Coal Co.,
130 Neb. 302, 264 N.W. 877 (1936).
- Where evidence failed to
establish that minor son had been emancipated or that direct contract
of hire existed between father and son, county which had contracted
with father to do road work was not liable to minor because it failed
to require the father to carry insurance. Holt County v. Mullen, 126
Neb. 102, 252 N.W. 799 (1934).
- County letting contract without
requiring contractor to furnish insurance policy protecting
contractor's employees, is jointly liable with contractor to its
employee who received compensable injury. Standish v.
Larsen-Merryweather Co., 124 Neb. 197, 245 N.W. 606 (1932).
- Section does not include owner
who requires contractor to take out compensation insurance, or
contractor who requires subcontractor to do so. Matthews v. G. A.
Crancer Co., 117 Neb. 805, 223 N.W. 661 (1929).
3. Effect of election
- Contention that defendants became
employer within compensation law, by failure to require insurance to be
taken out, was not sustained by evidence. Petrow & Giannou v.
Shewan, 108 Neb. 466, 187 N.W. 940 (1922).
employee who has properly elected not to come under part II of the
Workmen's Compensation Act, cannot recover compensation from owner and
owner does not become employer, even though owner does not require
immediate employer to carry compensation insurance. White v. National
Window Cleaning Co., 132 Neb. 155, 271 N.W. 341 (1937).
statutory employer provisions of this section do not supersede the
exemption provisions of section 48-106(2). Nussbaum v. Wright, 217 Neb.
712, 350 N.W.2d 559 (1984).
- General test of whether work
being done by an independent contractor is within this section is
whether the work would ordinarily be done by employees of the owner in
view of the owner's past practices and the practices of employers in
comparable businesses. Rogers v. Hansen, 211 Neb. 132, 317 N.W.2d 905
- A statutory employer who pays
benefits under the joint and several liability created by this section
is entitled to indemnity from the actual employer. Duffy Brothers
Constr. Co. v. Pistone Builders, Inc., 207 Neb. 360, 299 N.W.2d 170
- Immediate employer is not a
necessary party to a proceeding against a statutory employer. Gardner
v. Kothe, 172 Neb. 364, 109 N.W.2d 405 (1961).
- Independent contractor employing farm labor was not subject to act. Keith v. Wilson, 165 Neb. 58, 84 N.W.2d 192 (1957).
- This section has no application
to the relation of a bona fide vendor and vendee. Heider v. Stoughton,
150 Neb. 741, 35 N.W.2d 814 (1949).
- County was employer of workman on
county road project, even though workman was hired by foreman employed
by city and even though no record was made of oral authorization to
employ help. Steward v. Deuel County, 137 Neb. 516, 289 N.W. 877 (1940).
- Owners of building may be liable
as third persons for death of workman through their negligence while in
service of lessee's contractor. Tralle v. Hartman Furn. & Carpet
Co., 116 Neb. 418, 217 N.W. 952 (1928).