AMY J. ZILLMER, Employee/Respondent, v. KAREN LAMB for minor S. L., UNINSURED, Employer/Respondent, and ORION ISO, INC., and SEC. NAT’L/AMTRUST N. AM., Employer-Insurer/Respondents, and SPECIAL COMP. FUND, Appellant.

The Special Compensation Fund appeals the compensation judge’s order granting a motion to dismiss Orion ISO, Inc., and Security National/AmTrust North America from this matter.  We vacate the order.

On September 19, 2013, the employee, Amy J. Zillmer, was injured in a motor vehicle accident while working as a personal care attendant for three autistic minor children.  The children’s mother, Karen Lamb, manages some personal care services for her children and arranges for other personal care attendants using public funds dispensed to the minor children for services, wages, and goods needed for their care through Ramsey County and the Minnesota Department of Human Services.  Up to 2010, Ms. Lamb contracted with Orion ISO, Inc., (hereinafter Orion) for the services of personal care attendants employed by Orion.  In 2010, due to tax consequences, Ms. Lamb and Orion changed their contract, so that S. L., one of the minor children, legally became the employer of the personal care attendants, with Ms. Lamb acting on his behalf.  Orion continued to act as a payroll agent for the employer, and also provided other services such as handling employment applications, background checks, new employee paperwork, and workers’ compensation insurance.  After the employee’s injury in 2013, Ms. Lamb became aware that her workers’ compensation liability insurance had expired the year before, in 2012.

On October 11, 2013, the employee filed a first report of injury with the Department of Labor and Industry naming Ms. Lamb, who was acting on behalf of S. L., as her employer.  The Special Compensation Fund (hereinafter SCF) accepted liability and later filed a petition for reimbursement against Orion ISO, Inc., and Security National/AmTrust North America, its workers’ compensation liability insurer.  In response, Orion denied that it was an employer and petitioned to join Ms. Lamb as a necessary party.  On December 10, 2014, the compensation judge issued an order for joinder of Ms. Lamb.

On February 24, 2015, Orion filed a pretrial statement which included as an issue whether Ms. Lamb or Orion was the employer at the time of the employee’s injury.  SCF filed its pretrial statement on March 4, 2015, and included issues of whether Orion was an employer, a joint-employer, or a general contractor.

On August 28, 2015, Orion filed a motion to dismiss SCF’s petition for reimbursement against them, with prejudice.  The basis for their motion was the assertion that Orion was merely a payroll agent, not an employer.  Orion’s submission was 351 pages long and included documents and depositions.  On November 2, 2015, a special term conference was held on the motion at the Office of Administrative Hearings (hereinafter OAH) before the compensation judge.  During this recorded conference, Orion’s attorney referred to the conference as a “classic[] summary judgment type proceedings.”^[1]  No witnesses were called at the conference and no exhibits were offered or received into the record.  Counsel for Orion and SCF relied on the submissions, documents, and pleadings in framing their arguments.  The attorney for SCF argued that there was a genuine issue for the factfinder at hearing with respect to the nature of the employee’s employment status with Orion.

On November 6, 2015, the compensation judge granted Orion’s motion to dismiss, stating:

On November 24, 2015, SCF appealed, arguing that there is evidence contradicting the judge’s conclusion that Orion was not an employer and therefore the judge erred by making that determination without a full evidentiary hearing.

The Workers’ Compensation Court of Appeals is limited to the review of “an award or disallowance of compensation, or other order affecting the merits of the case.”^[3]  “As a general rule, an order ‘affecting the merits of the case’ is one that ‘finally determines the rights of the parties or concludes the action.’ ”^[4]  The policy behind the general rule is to prevent piecemeal appeals and to protect the rights of all parties until all claims have been adjudicated in the trial court.^[5]

On appeal, SCF contends the compensation judge committed an error of law by reaching the conclusion that Orion was not an employer, and accordingly granting dismissal, without holding an evidentiary hearing.  SCF contends that there are genuine questions of material fact bearing on whether Orion might be an employer, a joint-employer, or a general contractor, rather than only a payroll agent.

At the OAH conference, Orion’s attorney referred to the conference as a summary judgment type proceeding.  The Minnesota Workers’ Compensation Act does not provide for summary judgment hearings, but allows determination of legal issues on stipulated facts under Minn. Stat. § 176.322.  Under that statute, a compensation judge may determine a matter without a hearing.  Specifically, the statute states, “[i]f the parties agree to a stipulated set of facts and only legal issues remain, the commissioner or compensation judge may determine the matter without a hearing based upon the stipulated facts . . . .”^[6]  If, however, the evidence raises an issue of material fact, is conflicting, or permits reasonably different inferences, then the evidence should be submitted to the trier of fact.^[7]  The question of whether an entity is an employer of the injured employee is ultimately a question of fact. ^[8]

The compensation judge’s decision does not indicate what was considered and analyzed in deciding that Orion was not an employer.  There were no witnesses called and no exhibits were entered as a matter of record.  The record does not disclose any stipulation of facts.  Material facts are at issue regarding the employment relationships between Orion and/or Ms. Lamb and the employee, and the contractual relationship between Ms. Lamb and Orion.  Accordingly, we vacate the compensation judge’s order filed on November 6, 2015.