We’ve discussed several times the provisions outlining what constitutes exposure under the Longshore and Harbor Workers’ Compensation Act (LHWCA). We’ve also periodically reviewed the important insurance compliance provisions. Let’s once again review these requirements.
33 U.S.C. Section 904(a) – “Every employer shall be liable for and shall secure the payment to its employees of the compensation payable under Sections 907, 908, and 909. In the case of an employer who is a subcontractor, only if such subcontractor fails to secure the payment of compensation shall the contractor be liable for and be required to secure the payment of compensation.”
33 U.S.C. Section 905(a) – “…If an employer fails to secure payment of compensation as required by this Act, an injured employee, or his legal representative in case death results from the injury, may elect to claim compensation under the Act, or to maintain an action at law or in admiralty for damages on account of such injury or death.
33 U.S.C. Section 938(a) – “Any employer required to secure the payment of compensation under this Act who fails to secure such compensation shall be guilty of a misdemeanor and, upon conviction thereof, shall be punished by a fine of not more than $10,000, or by imprisonment for not more than one year, or by both such fine and imprisonment; and in any case where such employer is a corporation, the President, Secretary, and Treasurer thereof shall be also severally liable to such fine and imprisonment as herein provided for the failure of such corporation to secure the payment of compensation , and such President, Secretary, and Treasurer shall be severally personally liable, jointly with such corporation, for any compensation or other benefit which may accrue under the said Act in respect to any injury which may occur to any employee of such corporation while it shall so fail to secure the payment of compensation as required by Section 932 of the Act.”
33 U.S.C. Section 932 – “Every employer shall secure the payment of compensation under this Act –
Every employer who employs a “maritime” worker covered under the LHWCA must insure its LHWCA workers’ compensation liability with either an insurance company authorized by the Secretary of Labor to provide LHWCA coverage, or must be authorized by the Secretary of Labor as a Self-Insured Employer.
If an employer is uninsured as a result of failing to comply with one of the Section 32 alternatives, then:
NOTE: An insurance policy or endorsement issued by an insurance carrier not authorized by the U.S. Department of Labor to write coverage under the LHWCA leaves the employer in an uninsured status.
NOTE: Each of the extensions of the LHWCA, namely, the Defense Base Act (DBA), the Outer Continental Shelf Lands Act (OCSLA), and the Nonappropriated Fund Instrumentalities Act (NAFIA), are all separate exposures requiring coverage by approved policy or endorsement.
So now we know that if you are a “maritime employer” you must have insurance coverage for exposure under the LHWCA. And we know about the consequences for the employer if it fails to properly secure the exposure.
How do you know if you are a “maritime employer”?
You are a maritime employer if you employ at least one “maritime employee”.
Who is a maritime employee?
If you go to the U.S. Department of Labor’s website (DOL administers the LHWCA) you will see that one of the questions that DOL tries to answer is, “Do I need Longshore Act Insurance”.
Here is the DOL’s answer in its entirety:
“The requirement to have Longshore Act insurance varies from situation to situation, and from state to state. The best way to determine the need is to talk directly with your nearest Longshore district office, so that you can explain the specifics of your work site and employment situation.”
For many reasons this is terribly unhelpful. But what can you do in one short paragraph? There are indeed many variables, too many subtle regional differences in interpretation, too many occupations, too much geography, too much factual hair splitting to provide a single coherent answer.
The Longshore Insider offers numerous coverage discussions in dozens of scenarios and iterations, covering many occupations and locations. The context is “Status” and “Situs”.
Status (33 U.S.C. 902(3)) is an occupational concept and encompasses many jobs in addition to the traditional maritime fields of longshoreman, shipbuilder, ship repair, and ship breaker. It can include not only workers who handle cargo and build/repair ships, but also workers who build, repair and maintain the tools, equipment, and buildings essential to cargo handling and building/repairing ships.
There is no “moment of injury” test for status. Even a small percentage of regularly assigned maritime duties produces a full-time maritime exposure.
Situs is a geographic and functional concept that is determined by location as of the time of the injury. You meet situs by being injured over “navigable waters”, or by being injured on an “enumerated site” such as a dry dock, pier, wharf, terminal, building way, or marine railway, or by being injured in an other adjoining area customarily used by an employer for maritime work.
So, once again in view of the consequences to the employer for needing coverage and not having it, play it safe. If you’re working near the water, think about the LHWCA and consult an expert.
In Part Two, I intend to attempt to discuss the issues of exposure and the compliance provisions as they relate to some of the peripheral, ambiguous, uncertain, and extremely problematic issues of employer-employee relationship, independent contractor status, and other questions on the fringe. I am not looking forward to it.