An area of workers’ compensation that has grown in controversy over the years is when is an employee considered to be “at work.” A question arises if an employee is injured when in a parking lot outside of their place of employment either starting their day or leaving after clocking out. Depending on the workers’ compensation law in your state, this type of injury may not be a compensable work-related accident. However, some states are changing legislation to expand the boundaries of workers’ compensation to allow for more covered areas putting a greater burden on the employer and its workers’ compensation carrier to ensure against accidents in areas over which they have no control.
On January 10, 2022, New Jersey Governor Phil Murphy signed Senate Bill 771, significantly impacting current workers’ compensation law in that state. In New Jersey, the law was consistent for over a decade or so. An injured worker was entitled to workers’ compensation benefits for an accident “arising out of and in the course of employment.” N.J.S.A. 34:15-7.
Prior to 1979, the courts in the state of New Jersey applied the “going and coming rule” to determine if an injured worker was entitled to workers’ compensation benefits. If an employee was injured going to or coming from work, the claim was not compensable. Watson v. Nassau Inn, 74 N.J. 155, 158 (1977). The legislature then amended the Workers’ Compensation Act in 1979 to update the definition of “employment.” Under the 1979 amendment:
“Employment shall be deemed to commence when an employee arrives at the employer’s place of employment to report for work and shall terminate when the employee leaves the employer’s place of employment, excluding areas not under the control of the employer.”N.J.S.A 34:15-36
The 1979 amendment replaced the “going and coming rule” with the “premise rule.” Under the “premise rule,” an injured worker was entitled to workers’ compensation benefits if the injury occurred on the employer’s premise. Cressey v. Campus Chefs, Div. of CVI Serv., Inc., 204 N.J. Super. 337, 342-43, (App.Div.1985). The “premise rule” included more than the four walls of an office or plant. Kristiansen v. Morgan, 153 N.J. 298, 316 (1997). In order to determine if the injury was on the employer’s premise, the courts looked to 1) where was the situs of the accident, and 2) did the employer have control of the property on which the accident occurred. Livingstone v. Abraham & Strauss, Inc., 111 N.J. 89, 96, (1988). Control was satisfied if the employer owns, maintains or has exclusive use of the property.
In Livingstone, the employer, a tenant in a multi-tenant mall, directed the employees to park in the far end of a mall parking lot in order for customers to have closer spaces. The worker was struck by a motor vehicle while walking to the building to start her workday. The court held the injuries arose out of and in the course of employment as the employer was provided with a benefit by the employees parking at the far end of the lot to let customers have close access and there was added hazard when the employee was forced to walk through the parking lot.
The holding in Livingstone was then clarified in the case of Novis v. Rosenbluth Travel, 138 N.J. 92 (1994). In Novis, the employee traveled to a branch office for temporary work. She parked in a lot adjacent to the office building that was for the building’s tenants and slipped on the sidewalk that led to the sole entrance of the building. The court held her injuries were non-compensable as the employer had no control over any portion of the parking lot. Use of the lot itself was not enough to establish employer control.
The boundaries of the “premise rule” were tested in Hersh v. County of Morris, 217 N.J. 236 (2014) and it was the decision in Hersh that led those in the state of New Jersey Legislature to push for the recent amendment to the Workers’ Compensation Act to expand the boundaries involving parking lot claims.
In Hersh, the injured worker was struck by a motor vehicle while crossing a public street. She had parked her vehicle in a garage a few blocks from the office building. The county had rented sixty-five spots for its employees in the garage. There was also a county owned lot adjacent to the building with spots assigned by seniority. Hersh did not have enough seniority to qualify for such parking. Rather, she was provided with a scan card and instructed to park on the third level of the garage a few blocks from the building. No particular spot was assigned to her.
The court held her injuries did not arise out of and in the course of her employment as the accident did not take place on the employer’s premise and the employer did not exercise “control” when provided off-site parking. The court found the county had no direct business interest in paying for the employee parking in the garage. The accident occurred on a public street with no additional hazards and the county did not control the ingress or egress route that Hersh took to the building as there were numerous ways for her to go to arrive.
The law in the state of New Jersey is now changing with Governor Murphy signing a bill expanding parking lot liability in workers’ compensation claims. Senate Bill 771 now amends Section 36 of the Workers’ Compensation Act to the following:
Employment shall also be deemed to commence, if an employer provides or designates a parking area for use by an employee, when an employee arrives at the parking area prior to reporting for work and shall terminate when an employee leaves the parking area at the end of a work period; provided that, if the site of the parking area is separate from the place of employment, an employee shall be deemed to be in the course of employment while the employee travels directly from the parking area to the place of employment prior to reporting for work and while the employee travels directly from the place of employment to the parking area at the end of a work period.
Under this amendment, ownership or control of a parking lot not adjacent to the place of business no longer matters if the employer “provides or designates” a parking area and the injury occurs in that parking area. Additionally, if the injury occurs in a public area while the employee is on the way to the place of business from a designated lot, the injury is now compensable.
The legislature did not address what factors are relevant to determine “provides” and leaves that term as ambiguous. This will require a thorough review of each claim for injury that occurs in a parking lot. Now each claim in the state of New Jersey must be reviewed on a case-by-case basis with the insurance carrier to determine if the injury should be a compensable work-related accident and therefore covered under workers’ compensation.