Payments, power to terminate show retiree is employee

In Mississippi, evidence that a worker was paid and that the employer had a power to terminate him is evidence of an implied contract of hire.

Case name: Hugh Dancy Co., Inc. v. Mooneyham, No. 2010-WC-00439-COA (Miss. Ct. App. 02/15/11).

Ruling: The Mississippi Court of Appeals held that a retiree was entitled to benefits because he was an employee at the time of his injury.

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What it means: In Mississippi, evidence that a worker was paid and that the employer had a power to terminate him is evidence that there was an implied contract of hire.

Summary: A retiree worked for a company for 50 years before leaving. Shortly after his departure, he went to the work site to visit old acquaintances. The office manager asked the retiree to help clean out the closed construction shop. The retiree said that he began to spend four days per week at the shop. Upon his return to the company, he was not put on payroll, he had no set work schedule, and he reported to no one. He received four checks from the company for "reimbursement," "services rendered," and "shop help." The company did not withhold taxes from these payments. The retiree received injuries from a fall at the work site and sought workers' compensation. The company asserted that the retiree was not an employee when he was injured. The Mississippi Court of Appeals held that the retiree was entitled to benefits.

The court concluded that the parties had an implied contract of hire. The office manager requested the retiree to return to work and he accepted the offer. The reimbursement money paid to the retiree indicated that he worked before the check was dated. The company argued that the check for "services rendered" was a Christmas bonus, but the administrative judge found the explanation not credible. Additionally, the company knew that the retiree worked in the shop and had the power to terminate him.

Read more at the WorkersComp Forum homepage.

April 4, 2011

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