Humphrey v. WHOLE FOODS MARKET ROCKY MT.

Citations: 250 P.3d 706; 2010 Colo. App. LEXIS 446; 2010 WL 1238860Docket: 09CA0234

Court: Colorado Court of Appeals; April 1, 2010; Colorado; State Appellate Court

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James Humphrey, a delivery driver for Phil's Fresh Foods, and Twin City Fire Insurance Company, his workers' compensation insurer, appealed a summary judgment favoring Whole Foods Market in a premises liability negligence case. Humphrey sustained injuries while performing delivery-related tasks at Whole Foods, prompting him to sue for negligence, with Twin City intervening to recover costs under Colorado law. The district court ruled Whole Foods was Humphrey's statutory employer, granting it immunity from common law negligence claims related to the injuries. 

On appeal, the court confirmed that the underlying facts were undisputed and reviewed the summary judgment de novo. It concluded that Whole Foods qualified as Humphrey's statutory employer under Colorado's statutory framework, affirming the district court's decision. The ruling underscored that while the status of statutory employer is typically a factual question, it can be resolved as a matter of law when the facts are not in dispute.

The Workers' Compensation Act establishes that an injured employee is entitled to compensation from their employer, regardless of negligence, while the employer is granted immunity from common law negligence claims. A "statutory employer" is defined under Section 8-41-401(1)(a) as any entity conducting business through leasing or contracting, making it liable for workers' compensation benefits to employees of contractors or subcontractors. This provision ensures that employers cannot evade responsibility by utilizing separate, uninsured entities. Section 8-41-401(2) provides that if a direct employer has workers' compensation insurance, the statutory employer is immune from suit, meaning the injured employee cannot pursue tort claims against the statutory employer. The determination of whether an employer qualifies as a statutory employer hinges on whether the contracted work is integral to the employer's regular business operations, assessed through factors such as routineness, regularity, and the necessity of the work being performed by the employer's own employees if not for the contractor.

Humphrey argued in the district court that no contract existed between Phil's and Whole Foods, asserting this lack of a contract meant Whole Foods could not be considered a statutory employer under section 8-41-401(2) and was therefore liable for torts. The district court, however, concluded that an oral or implied in fact contract did exist for the sale, delivery, stocking, and inventorying of burritos. This finding was not contested on appeal, thus affirming the existence of a contract. Whole Foods, as a grocery retailer, regularly engages in purchasing, stocking, and displaying food for sale. Evidence from the Whole Foods store receiver supported that they needed vendors for food supply and that Humphrey’s tasks—including inventorying, selecting, and displaying burritos—were integral to Whole Foods’ operations. The court determined that without Humphrey’s services, Whole Foods would have needed to employ its own staff to perform these duties, establishing that Whole Foods was Humphrey's statutory employer under section 8-41-401(1)(a). Plaintiffs argued that the relationship was merely vendor-vendee and that Humphrey’s services were part of the purchase price. However, these arguments were rejected as irrelevant to the statutory employer determination. The plaintiffs also referenced the case of Doyle v. Missouri Valley Constructors, Inc., where the court found that a general contractor was not a statutory employer due to the nature of the supplier's services. The court distinguished that case from the current situation, emphasizing that the responsibilities of Humphrey in this instance were related to Whole Foods' regular business operations.

The supplier's employees did not perform key tasks related to concrete work, such as tamping, leveling, or finishing. In contrast, Humphrey engaged in substantial activities for Whole Foods, including inventory management and burrito stocking, which are integral to Whole Foods' operations as a grocery retailer. These responsibilities would have otherwise been handled by Whole Foods employees. The plaintiffs cited various cases from other jurisdictions regarding statutory employer status under workers' compensation laws, but the court found these cases unconvincing as they applied different legal standards than Colorado's. Under Colorado law, an employer is considered a statutory employer if the subcontracted services are essential to the employer's business and would need to be performed by its own employees if not provided by the subcontractor. The court distinguished Colorado's test from those in cited cases, which had different requirements related to the nature of the employer-subcontractor relationships. Ultimately, the court concluded that Whole Foods was Humphrey's statutory employer, affirming that Whole Foods is immune from common law negligence claims due to the presence of workers' compensation insurance through his actual employer, Phil's. The district court's summary judgment in favor of Whole Foods was therefore upheld, with Judges CASEBOLT and GABRIEL concurring.