What Is a Subdivision of a State Government?
This question concerns employees who may or who may not be covered by the Longshore and Harbor Workers’ Compensation Act, depending on who the employer is. As we know from previous discussions, the maritime employer must get its coverage right or face serious consequences, so this type of question is important.
Section 903(b) (33U.S.C. 903(b)) of the Longshore Act states:
“No compensation shall be payable in respect of the disability or death of an employee of the United States, or any agency thereof, or of any State or foreign government, or any subdivision thereof.”
You will not be surprised to learn that the Longshore Act does not define “subdivision” of a state government, and the U.S. Department of Labor’s Regulations at 20 C.F.R. 701 and following offer no help.
It’s usually self-evident who is an employee of a U.S. Government agency, or of a state government, or of cities and towns. Most of the time we even know who is working for foreign governments. But, not always, and like we’ve said many times, there are numerous instances where it depends on the facts of the case.
It can get tricky when you are talking about employees of a port authority, a state university, or of the wide variety of quasi-governmental operations.
So, in fact dependent cases like these, courts usually come up with a list of “quack like a duck” questions to help to determine the outcome.
The list of questions in a section 903(b) case usually involves some or all of the following in one form or another:
- Who directs the organization and how are these persons appointed and removed,
- Are required reports filed with the government and does the government have a veto over decisions,
- Does it operate on a profit or non-profit basis,
- How is its property and revenue taxed, or is it tax exempt,
- Does it have the power of eminent domain,
- Is money appropriated to it by the government,
- Who pays its employees, and provides fringe benefits,
- Does it have the power to assess or collect taxes,
- Are its operations subject to open, public hearings,
- Are its records open to the public,
- Does it have the power of subpoena,
- What is its status under state law?
Theoretically, the answers to a list of questions like this tell you everything you need to know. The answers don’t have to be consistent or unanimous one way or the other. The issue will be decided by analyzing the responses and determining which way a majority of the answers tend.
If the determination is that the organization is a subdivision of a state then under section 903(b) its employees are not covered by the Longshore Act because they are government employees. If the employees are not government employees then the employer must provide Longshore Act insurance if the status and situs requirements for coverage are met.