SC Section 42-1-360 describes the exemption of casual employees from coverage under the Workers Compensation Act, and certain other employers from the requirement of providing workers compensation insurance coverage for their injured workers. Some of the listed exemptions are so commonly known that they never arise in a state claim setting,( or if they do, it is usually painfully apparent that the Claimant’s lawyer is too inexperienced to know better). Railroad workers and employers, agricultural employees and employers, and federal employees are some examples of employers and employees who are exempt.
When a claim is filed against an employer who does not have workers compensation coverage, (and not obviously excluded) the first question is whether or not there are four or more employees regularly employed in the state in the same business. If there are not, the employer is exempt, he is not required to have coverage and the Commission is without jurisdiction. There may be some issue as to whether are not the employee is casual, or regular, but the Act generally favors inclusion rather than exclusion, so quite often that inquiry is decided against the employer in favor of the injured worker. The question is usually the number of employees regularly employed in the state in the same business, however, what if the employment is not a “business” at all?
I recently had a hearing involving a case that was filed by a domestic worker who had been employed by an elderly gentlemen to provide in home care for his wife and himself, both of whom were in their late eighties. He filed state and local taxes as a “domestic “ employer and the employee was paid by payroll check and given a W-2 at the end of the year, as required by federal and state tax guidelines. She was admittedly his employee, and was one of 4 – 6 such domestic employees employed for the same purpose. His wife has Alzheimers and requires round the clock care, which the domestic workers provided. The employer did not deny that the claimant was his employee, nor did he deny that he had more than 4 employees, but took the position that the Commission did not have jurisdiction because he did not have a “business”.
There was no case law on this point in SC and very little in other states, although some states specifically list domestic employment as exempt from their Act. The Single Commissioner denied the claim based on a finding that the Commission did not have jurisdiction. He further found that the intent of the legislators was to exclude employers who were not in a commercial “business.” He further found that domestic employers are not a “business” in that they contribute to the employer’s household, not his business and that he was not supplying a good or a service in his employment of domestic workers to care for his wife and himself. Domestic employment would include nannies, babysitters, gardeners, or anyone else employed to perform domestic or household duties for a private employer. In this particular case, the employer was retired and had no other businesses. The outcome might have been different had he actually been in some other business, particularly if he listed his domestic employees on the payroll of his business, as many do for tax purposes; however under the facts of this particular case, the Single Commissioner found there was no jurisdiction.
This matter was only heard at the Single Commissioner level and could be appealed to the Appellate Panel. We are cautiously optimistic that this decision would be affirmed if it is appealed.