If an employee of a contractor you’ve hired gets injured on the job, the person can seek workers’ comp benefits from the contractor. But can the worker also come after you with a lawsuit for damages—arguing that you put them at risk by not ensuring that the contractor was competent to perform the work? The California Supreme Court now says no. But as we’ll explain, it’s still important to take precautions when hiring independent contractors.
Contractor’s Employee Killed
Tjaarda Dairy in Kern County needed to remove mounds of manure from its corrals. Because the piles were too slippery after a wet winter for its employees to do the work, the dairy hired Golden Cal Trucking. During the job, Golden Cal employee Alberto Camargo was killed when the Golden Cal tractor he tried to drive over a manure pile went out of control and rolled over.
400+ pages of state-specific, easy-read reference materials at your fingertips—fully updated! Check out the Guide to Employment Law for California Employers and get up to speed on everything you need to know.
Worker’s Family Sues
Camargo’s family sued the Tjaarda Dairy, contending the dairy was negligent in hiring Golden Cal. They claimed the dairy didn’t use reasonable care in selecting a competent contractor and didn’t determine whether Camargo was qualified to operate the tractor safely.
The dairy countered that Camargo’s family had no right to sue for damages and could only claim workers’ comp benefits from Golden Cal. A California Court of Appeal disagreed and said the case could go forward. But now the California Supreme Court has reversed that ruling.
High Court Rejects Negligent Hiring Claim
The high court explained that previous cases established that you can’t be held liable for injuries to a contractor’s employee caused by the contractor’s negligence. This is true even if you failed to provide in the contract or in some other manner that special precautions be taken when your job has special risks. The rationale for shielding the hirer of an independent contractor is that the contracting employer’s workers’ compensation covers the employees’ injuries. It would be unfair to impose liability on the hirer when the contractor—who is primarily responsible for causing the injury—is only on the hook for workers’ comp coverage.The court said that this same reasoning precludes a contractor’s employee from suing you for negligent hiring for failing to exercise reasonable care in selecting a competent contractor. Thus, the court threw out the lawsuit against Tjaarda Dairy.
Caution Still Required
However, it’s still critical to take precautions when hiring independent contractors. That’s because you can be liable for harm to third parties from a contractor’s negligence. This is true if there is a foreseeable risk that someone could be harmed by the work and you fail to exercise reasonable care to determine that the contractor is competent. Note, too, that a question remains open about whether a contractor’s employees can sue you if you were negligent in providing unsafe equipment.
Here’s how you can protect yourself when hiring independent contractors:
- Conduct a thorough background check. Find out whether the contractor has competently performed the same type of work before by verifying several past references.
- Obtain an indemnity agreement. Have the contractor agree in writing to indemnify you for all claims arising out of the work to be performed.
- Verify workers’ comp insurance. Make sure the contractor carries workers’ compensation insurance. A California court previously held that a contractor’s employees could sue the hirer for injuries if the contractor was uninsured.