W.C. No. 4-348-699Industrial Claim Appeals Office.
March 26, 1999.
FINAL ORDER
The claimant seeks review of a final order of Administrative Law Judge Wheelock (ALJ) which denied and dismissed his claim for benefits on the grounds that he was not an employee of respondent Burnham Services Corporation (Burnham). The claimant contends that the agreement under which he leased his tractor truck to Burnham did not comply with § 40-11.5-102(5)(a),(b) (c), C.R.S. 1998, because the lease did not “provide for coverage under workers’ compensation or a private insurance policy the provides similar coverage.” We affirm.
On May 8, 1996, the claimant entered into an “Independent Contractor Agreement” with Burnham under which he leased his tractor and services as driver to Burnham. It is now undisputed that the terms of the lease contain the provisions specified in §40-11.5-102(4), C.R.S. 1998, so as to create the presumption of independent contractor status. On the same day, the claimant applied for “occupational accident” insurance with the National Association of Independent Truckers, Inc. (NAIT). The application for insurance reflects that the claimant was referred to NAIT by Burnham.
The claimant was injured on October 24, 1996. The respondents disputed the claim, arguing that the claimant was not Burnham’s “employee” for purposes of workers’ compensation because he was “working as a driver under a lease agreement pursuant to § 40-11.5-102, C.R.S., with a common carrier or contract carrier.” Section 8-40-301(5), C.R.S. 1998. The ALJ found that the lease agreement satisfied the requirements of § 40-11.5-102(4), and that the claimant failed to overcome by clear and convincing evidence the presumption that he was an independent contractor. The ALJ further found the lease provides “for coverage under workers’ compensation sufficient to satisfy” § 40-11.5-102(5). Therefore, the ALJ dismissed the claim.
On review, the claimant disputes the ALJ’s conclusion that the lease provides for workers’ compensation coverage or similar coverage within the meaning of § 40-11.5-102(5)(a). The claimant acknowledges that section 12.1 of the lease agreement states that the claimant is responsible for obtaining “worker’s compensation insurance” for himself and any employees and subcontractors. Further, section 12.4 of the lease provides that Burnham was to maintain insurance for the protection of the public under federal law, but “shall not be required to provide any other type of insurance hereunder.” However, the claimant argues that these provisions are too indefinite, and that the lease should have contained a provision explicitly stating that the claimant was eligible for “workers’ compensation insurance coverage by the Colorado compensation insurance authority or similar coverage consistent with the requirements set forth in § 40-11.5-102(5), C.R.S.” See § 8-40-301(6), C.R.S. 1998. We perceive no error in the ALJ’s order.
The overall purpose of statutory construction is to effect the intent of the General Assembly. The best guide to the intent of the legislature is the language of the statute itself, and therefore, words and phrases in a statute must be given their plain and ordinary meanings. Snyder Oil Co. v. Embree, 862 P.2d 259 (Colo. 1993). To the extent a statute is ambiguous, we must construe the statutory scheme in a manner that gives consistent, harmonious, and sensible effect to all of its parts. In so doing, we may consider the relationship of the various provisions, the state of the law prior to the legislative enactment, and the problem which the legislature sought to solve. Henderson v. RSI, Inc., 824 P.2d 91 (Colo.App. 1991).
Section 8-40-301(5) excludes from the definition of “employee” a person working as a driver under a lease agreement meeting the requirements set forth in § 40-11.5-102. Section 8-40-301(5) was enacted simultaneously with § 8-40-301(6) and § 40-11.5-102(5)(a)-(c). 1992 Colo. Sess. Laws, ch. 224 at 1798-1801. The purpose of these amendments was to “clarify” that drivers working for contract carriers under qualifying lease agreements are to be treated as “independent contractors” for purposes of workers’ compensation benefits liability. Prior to the amendments, the Department of Labor and Employment had applied a more expansive definition of “employee” and treated many drivers as covered under workers’ compensation. Frank C. Klein Co., Inc. v. Colorado Compensation Insurance Authority, 859 P.2d 323
(Colo.App. 1993).
In light of this overall statutory objective, we disagree with the claimant that, under § 40-11.5-102(5)(a), a lease agreement which qualifies to exclude a driver from the definition of an “employee” must contain a specific provision advising the driver that workers’ compensation insurance is available from the Colorado compensation insurance authority and that he is eligible to purchase it. Section 40-11.5-102(5)(a) merely states that a lease agreement must “provide for coverage under workers’ compensation or a private insurance policy that provides similar coverage.” Further, subsection(c) states that “the lease shall provide for the payment of such coverage by either the lessor or lessee.” The plain meaning of the term “provide,” as it is used here, connotes a requirement that the lease contain a “provision or stipulation” for insurance. Webster’s II New College Dictionary. Therefore, the plain meaning of § 40-11.5-102(5)(a) does not mandate the specific advisement for which the claimant argues.
Had the General Assembly intended that the lease itself incorporate notification of the right to purchase insurance, as provided in § 8-40-301(6), we believe that such a requirement would have been expressly incorporated into § 40-11.5-102(5). This is true because § 40-11.5-102 is the statute which governs the contents of lease agreements sufficient to create the presumption of independent contractor status. However, the legislature placed the requirement for an “offer” of compensation insurance by the Colorado compensation insurance authority or similar coverage under § 8-40-301(6) in a completely different section of the statute.
We also note that the claimant was apparently notified of his right to purchase coverage similar to that provided by the Colorado compensation insurance authority. In fact, on the same day the claimant signed the lease agreement, he applied for “occupational accident” insurance from NAIT.
It follows that we perceive no error in the ALJ’s conclusion that the lease agreement signed by the claimant was sufficient to create the presumption of independent contractor status contemplated by § 8-40-301(5) and § 40-11.5-102(4). The lease agreement contains a stipulation that the claimant was required to obtain compensation insurance, and that the claimant was liable to pay for it. Further, the claimant was apparently advised of his eligibility to purchase insurance similar to that provided by the Colorado compensation insurance authority. The mere fact that the notification was outside of the lease is insufficient to vitiate the lease for purposes of creating independent contractor status. We need not reach the question of what would occur if a driver were not notified of his rights under § 8-40-301(6).
IT IS THEREFORE ORDERED that the ALJ’s order dated April 17, 1998, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
_________________________________ David Cain
_________________________________ Dona Halsey
NOTICE
This Order is final unless an action to modify or vacate the Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, Colorado 80203, by filing a petition to review with the court, with service of a copy of the petition upon the Industrial Claim Appeals Office and all other parties, within twenty (20) days after the date the Order was mailed, pursuant to §§ 8-43-301(1) and 307, C.R.S. 1997.
Copies of this order were mailed March 26, 1999 to the following parties:
Jim M. Steir, 1219 Toltec Gorge, Pueblo, CO 81006
Burnham Services Corp., P.O. Box 7966, Columbus, GA 31908-7966
Anna M. Hendershot, Travelers Companies, P.O. Box 173762, Denver, CO 80217-3762
James A. Carleo, Esq., 1401 Court St., Pueblo, CO 81003 (For Claimant)
Larry Blackman, Esq., 1515 Arapahoe St., Twr. 3, Ste. 600, Denver, CO 80202 (For Travelers)
Ted A. Krumreich, Esq., John L. Lebsack, Esq., 1225 17th St., 28th Flr., Denver, CO 80202 (For Burnham)
By: ___AP___