In a unanimous opinion, the Indiana Court of Appeals has ruled that “sibling corporations” – entities with completely separate corporate structures but a shared parent corporation – are joint employers of each corporation’s employees for purposes of the “exclusive remedy” provision of Indiana’s Worker’s Compensation Act. See England v. Siebe, et. al., 2024 Ind. App. LEXIS 332 (Ind. Ct. App. 2024).
In England, the plaintiff delivered a package in the course and scope of her employment with FedEx Express, Inc., which is a wholly owned subsidiary of FedEx Corporation. As she walked toward the loading dock to hand off the package, a driver operating a tractor-trailer in the course and scope of his employment FedEx Freight, Inc. – another wholly owned subsidiary of FedEx Corporation – backed into the loading dock. The plaintiff and the driver failed to notice one another and the plaintiff was pinned against the loading dock by the tractor-trailer, resulting in severe injuries.
The plaintiff subsequently sued both the driver of the tractor-trailer and FedEx Freight. However, Indiana’s Worker’s Compensation Act establishes that the “exclusive remedy” against an employer by an employee injured in the course and scope of their employment is the rights and remedies established by the Act. Ind. Code § 22-3-2-6. Accordingly, in this case, if FedEx Freight and FedEx Express were held to be joint employers of the plaintiff, then the Indiana judiciary would have no jurisdiction over the plaintiff’s claims.
In an effort to gain access to the Indiana judiciary, the plaintiff argued that FedEx Freight, as a “sibling corporation” of FedEx Express, was not her joint employer. Rather, the plaintiff argued that only FedEx Express’s parent corporation would be considered her joint employer. The Court of Appeals disagreed. The Worker’s Compensation Act defines an “employer” to expressly include "a parent corporation and its subsidiaries," which "shall each be considered joint employers" of the injured employee. Ind. Code § 22-3-6-1(a). The Court reaffirmed Hall v. Dallman Contractors, LLC, 51 N.E.3d 261 (Ind. Ct. App. 2016) and McQuade v. Draw Tite, Inc., 659 N.E.2d 1016 (Ind. 1995), which rendered similar opinions in this regard. The Court also noted that the fact that the plaintiff has not received a worker’s compensation settlement has no bearing on the statutory definition of an “employer” under the Worker’s Compensation Act.
Lastly, the plaintiff argued that the exclusive remedy provision of the Worker's Compensation Act is unconstitutional. The Court also dismissed these arguments, citing previous case law which has upheld its constitutionality in light of the state Constitution’s Open Courts Clause, Right to Trial by Jury Clause, and Equal Privileges and Immunities Clause. See Sims v. U.S. Fid. & Guar. Co., 782 N.E.2d 345, 349 (Ind. 2003).
Opinions interpreting Indiana’s Worker’s Compensation Statute are relatively rare. As such, this opinion is instructive regarding the strict interpretation that Indiana Courts give to the Worker’s Compensation Act and the strength of the Act’s exclusive remedy provision. Whether the Indiana Supreme Court will weigh in on this case is not yet known.
If you have any questions regarding this ruling, please contact a member of our Worker’s Compensation Practice Group.
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