Was Oil Rig Worker who Largely Worked Independently a ‘Borrowed Servant’?

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A “borrowed servant” is entitled to workers’ compensation for work-related injuries. When the borrowed servant doctrine applies, it also limits workers’ ability to sue the company that “borrowed” them for negligence or other torts.

A recent case involving an employee whose company contracted him out to work on an oil rig  for another company highlights some of the factors that courts consider in deciding whether the doctrine applies. The employee worked for Danos, LLC, an oil field service provider, which contracted him out to work for W&T Offshore, the company that ran the rig. 

While on the rig, the worker received his instructions from W&T, not from Danos. He worked independently, for the most part. But W&T had authority to tell him where and when to work.

He attended morning meetings run by W&T, and while working on the platform, the only managers he communicated with worked for W&T. In fact, while working on the platform, the worker did not maintain contact with Danos. W&T provided transportation to and from the platform and provided the employee’s meals.

The worker received his paycheck from Danos based on time sheets that were approved by W&T. W&T had the right to remove him from its platforms for any reason, but only Danos had the right to terminate his employment with Danos.

About two years into his job working on the platform, the employee was injured and sued W&T for negligence. W&T asked the court to throw out the case, arguing that the workers’ compensation act’s exclusivity provision made workers’ compensation the employee’s sole remedy. 

The court explained that the exclusivity provision would only apply if the worker was W&T’s employee. Under the borrowed servant doctrine, an employee of another company may be found to be an employee of another company, thus entitling him to workers’ compensation as his sole remedy.

To determine borrowed employee status, courts consider nine factors, often giving great weight to the first factor:

(1) Who had control over the employee and the work he is performing, beyond mere suggestion of details or cooperation?

(2) Whose work was being performed?

(3) Was there an agreement, understanding, or meeting of the minds between the original and the borrowing employer?

(4) Did the employee acquiesce in the new work situation?

(5) Did the original employer terminate his relationship with the employee?

(6) Who furnished tools and place for performance?

(7) Was the new employment over a considerable length of time?

(8) Who had the right to discharge the employee?

(9) Who had the obligation to pay the employee?

Could the worker sue W&T for negligence?

A. No. Because W&T exercised control over him and paid him and served as his managerial contact on the rig, he was the company’s employee under the borrowed servant doctrine.

B. Yes. He was not a borrowed employee because he worked independently, was paid by Danos, and only Danos could terminate him.

If you selected A, you agreed with the court in Harper v. W&T Offshore, Inc., No. 24-1101 (E.D. La. 12/23/24).

The court pointed out that when the employee was on the rig, W&T exercised control over him by requiring him to attend morning meetings and serving as his point of contact when he needed to talk to a manager. The fact that he largely worked independently was irrelevant.

While Danos cut his paycheck, the court observed, it did so based on the hours calculated by W&T and sent to Danos. Thus, for purposes of the borrowed servant doctrine, he was paid by W&T.

Regarding the right to terminate him, only Danos could fire him from Danos. However, W&T had the right to terminate his position on the rig at any time. Thus, for purposes of the doctrine, W&T had the right to terminate.

Because he was a borrowed employee, he could not sue W&T for negligence; his sole remedy was workers’ compensation.

The court granted summary judgment to W&T.

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