Supreme Court of Texas.
TIC ENERGY AND CHEMICAL, INC., Petitioner,
Kevin Bradford MARTIN, Respondent
Argued February 9, 2016
Opinion delivered: June 3, 2016
Rehearing Denied September 23, 2016
*69 ON PETITION FOR REVIEW FROM THE COURT OF APPEALS FOR THE THIRTEENTH DISTRICT OF TEXAS
Attorneys & Firms
Daniel A. Ray, Donato, Minx, Brown & Pool, P.C., Houston TX, for Petitioner.
James Cole, Justin L. Williams, Cole Easley Sciba & Williams, P.C., Victoria TX, for Respondent.
Jeffrey Blake Simon, Simon Eddins & Greenstone LLP, Dallas TX, for Amicus Curiae parties.
JUSTICE GUZMAN delivered the opinion of the Court.
“Recovery of workers’ compensation benefits is the exclusive remedy of an employee covered by workers’ compensation insurance coverage ... against the employer or an ... employee of the employer.”1 The issue in this personal-injury case is whether a subcontractor is entitled to the exclusive-remedy defense as a fellow employee of the general contractor’s employees by virtue of the general contractor’s written agreement to provide workers’ compensation insurance to the subcontractor.2 Under section 406.123 of the Labor Code expressly confers statutory-employer status on general contractors who provide workers’ compensation insurance to their subcontractors pursuant to a *70 written agreement.4 This case involves a written agreement that ostensibly meets the terms of both sections.
The trial court denied the subcontractor’s summary-judgment motion asserting the exclusive-remedy defense, and in a permissive interlocutory appeal, the court of appeals affirmed.5 The court determined, sua sponte, that an irreconcilable conflict exists between section 406.123, the subcontractor is the general contractor’s deemed employee for purposes of the exclusive-remedy defense. We therefore reverse the court of appeals’ judgment and render judgment for the subcontractor.
I. Factual and Procedural Background
Union Carbide Corporation employed Kevin Martin at its facility in Seadrift, Texas. Martin lost one of his legs in a workplace accident and recovered workers’ compensation benefits through an owner-controlled insurance program (OCIP) administered by Union Carbide’s parent company, Dow Chemical Company.7 Martin subsequently sued TIC Energy & Chemical, Inc., a subcontractor providing maintenance services at the Seadrift facility, alleging TIC’s employees negligently caused his injury.
TIC filed a traditional motion for summary judgment based on the Workers’ Compensation Act’s exclusive-remedy provision.8 TIC claimed the statutory defense as Martin’s deemed fellow employee based on section 406.123 of the Labor Code, which deems a general contractor the statutory employer of a subcontractor and its employees when the general contractor agrees in writing to provide workers’ compensation insurance to the subcontractor.9 TIC produced evidence of a written agreement with Union Carbide that extended workers’ compensation insurance coverage under the OCIP to TIC and its employees, with the cost of coverage premiums excluded from TIC’s bid.
In response, Martin argued the exclusive-remedy provision does not apply because *71 TIC was an independent contractor and had entered into a written contract with Union Carbide under which TIC “assume[d] the responsibilities of an employer for the performance of work.”10 section 406.123 merely permits subcontractors to receive workers’ compensation benefits under a general contractor’s insurance policy and entitles the general contractor to statutory protection as an “employer,” but does not make the subcontractor an “employee” of the general contractor for workers’ compensation purposes.
Martin argued TIC’s status as an “employee” is controlled by section 406.123 is dispositive.
The trial court denied TIC’s summary-judgment motion, but authorized a permissive interlocutory appeal, which the court of appeals granted.12 On appeal, the court concluded section 406.122(b)’s applicability.15
On appeal, both parties argue the provisions do not conflict and can be harmonized in their respective favor.
Our jurisdiction over interlocutory appeals is limited, and in this case, we have jurisdiction only if the lower court’s opinion “holds differently” from a decision *72 of another court of appeals or this Court.16 Decisions conflict when there is an “inconsistency ... that should be clarified to remove unnecessary uncertainty in the law and unfairness to litigants.”17
TIC argues the lower court’s opinion conflicts with section 406.122(b).
We hold jurisdiction exists based on a conflict with section 406.122(b), creates sufficient uncertainty in the law to confer jurisdiction over this appeal.26
III. Statutory Overview
The Texas Workers’ Compensation Act provides reciprocal benefits to subscribing employers and their employees. Covered employees sustaining work-related injuries are guaranteed prompt payment of their medical bills and lost wages without the time, expense, and uncertainty of proving liability under common-law theories.27 In exchange, the Act prohibits employees from seeking common-law remedies from their employers by making workers’ compensation benefits an *73 injured employee’s exclusive remedy.28 The exclusive-remedy defense extends to the employer’s servants, meaning covered employees secure additional benefits under the Act in the form of protection from personal-injury claims by co-workers.29 The issue in this case is the extent to which statutory benefits and protections afforded to a subscribing general contractor and its employees may be shared with subcontractors and their employees.
Section 406.122 of the Labor Code provides:
(a) For purposes of workers’ compensation insurance coverage, a person who performs work or provides a service for a general contractor or motor carrier who is an employer30 under this subtitle is an employee of that general contractor or motor carrier, unless the person is:
(1) operating as an independent contractor; or
(2) hired to perform the work or provide the service as an employee of a person operating as an independent contractor.
(b) A subcontractor and the subcontractor’s employees are not employees of the general contractor for purposes of this subtitle if the subcontractor:
(1) is operating as an independent contractor; and
(2) has entered into a written agreement with the general contractor that evidences a relationship in which the subcontractor assumes the responsibilities of an employer for the performance of work.31
section 406.122(b) applies, there is no employer-employee relationship between a general contractor and a subcontractor for workers’ compensation purposes and no reciprocity of protection.
In the next successive statutory provision, section 406.123 of the Labor Code provides:
(a) A general contractor and a subcontractor may enter into a written agreement under which the general contractor provides workers’ compensation insurance coverage to the subcontractor and the employees of the subcontractor.
(e) An agreement under this section makes the general contractor the employer of the subcontractor and the subcontractor’s employees only for purposes of the workers’ compensation laws of this state.35
In section 406.123 that “favors blanket coverage to all workers on a site” accords with legislative intent and the “Legislature’s ‘decided bias’ for coverage.”39
In this case, the summary-judgment record conclusively establishes that Union Carbide and TIC had an agreement complying with 406.123 have when agreements meeting the terms of both govern the general contractor and subcontractor relationship.
The proper construction of a statute presents a question of law that we review de novo.40 Our objective is to ascertain and give effect to the Legislature’s intent as expressed in the statute’s language.41 In doing so, we consider the statute as a whole, giving effect to each provision so that none is rendered meaningless or mere surplusage.42 When text *75 is clear and unambiguous, it is determinative of intent.43 Applying well-established statutory-construction principles, we discern no ambiguity in the relevant statutory provisions and the parties do not assert otherwise; we therefore construe it according to its plain language as informed by the statutory context without resorting to canons of construction and extrinsic aids.44
Consistent with the statute’s structure, TIC contends section 406.122(b) results in comprehensive coverage of workers at a single site in pursuit of a common objective and, therefore, extends the Workers’ Compensation Act’s benefits and protections both vertically and horizontally among multiple tiers of contractors that may be working side-by-side at a job site.45 This, TIC argues, is also consistent with our observation that an injured employee may have more than one employer entitled to claim the exclusivity defense.46
The structure of the subchapter in which section 406.123, and typically, a general rule is iterated before its exceptions, not after. Further, though a statutory heading does not limit or expand a statute’s meaning,47 the heading can inform the inquiry into the Legislature’s intent.48 The headings here confirm a rule/exception model, rather than the opposite.
section 406.123 deviates from that rule by creating the fiction of another.
Martin insists that the converse is true. According to Martin, section 406.123’s purpose, and our precedent.
First, Martin points out that section 406.122(b). Attempting to harmonize this view with our precedent, Martin offers a construction of the statute he contends (1) ensures employees at all tiers benefit from insurance coverage and (2) permits general contractors and subcontractors to assert the exclusive-remedy defense against claims by lower-tier subcontractors and their employees, but (3) does not permit lower-tier subcontractors and their employees to assert the exclusive-remedy bar as co-employees of higher-tier contractors and their employees. In other words, lower-tiered employees get some benefits the Workers’ Compensation Act offers to employees (prompt payment of claims) but not others (protection from personal-injury claims).
Martin’s strained construction runs counter to the statutory text because the exclusive-remedy provision only bars claims by an “employee” against an “employer.”51 If lower-tier subcontractors are not employees, then none of the higher-tier contractors could claim the defense. An interpretation that produces such a consequence is not only contrary to our holding in HCBeck, it is also counter to the Workers’ Compensation Act’s reciprocal-benefit scheme and defies logic.
Martin further contends that interpreting 406.122 as the general rule renders it superfluous because subsection (b) confirms that subcontractors are not employees *77 of the general contractor if the subcontractor is an independent contractor but independent contractors and their employees are already excluded as employees of the general contractor under subsection (a).52 Because the term “independent contractor” is used in both subsections, Martin contends subsection (b) is unnecessary for any purpose other than to create an exception to the statutory employment relationship created in section 406.123(e).
When construing a statute, we must give effect to all its words without treating any statutory language as mere surplusage, if possible.53 We disagree that subsection (b) is superfluous if section 406.122 is afforded the role TIC advocates, and even if it were, redundancy is not determinative. Indeed, “there are times when redundancies are precisely what the Legislature intended.”54
The Workers’ Compensation Act defines the terms “employee” and “employer” in different ways depending on the context. In section 406.123 in multi-tier contractor scenarios.
Finally, Martin complains that extending statutory immunity to subcontractors as fellow employees of higher-tier contractors would confer a benefit without the substantive quid pro quo the Legislature intended. While higher-tier contractors may be said to “provide” insurance to lower-tier contractors under HCBeck, Martin contends the same is not true in reverse. As Martin explains it, coverage provided through TIC to its employees and its subcontractors does not equate to coverage provided from TIC to Union Carbide’s employees; in other words, TIC has not “contribut[ed] something of value” to Martin.57 Martin’s argument misses the mark, however, because exclusive-remedy immunity goes both ways. That is, if Union Carbide’s employees are co-employees with TIC, Union Carbide’s employees enjoy the same statutory immunity that TIC enjoys. Mutual protection from personal-injury claims by those engaged in a common endeavor is *78 valuable and a significant component of the statutory scheme.58
Two additional arguments are advanced in the amicus brief. The first extols section 406.123 but disclaim whatever benefits and protections might ensue as a result.
Affording section 406.123 the legal effect dictated by its plain terms and supported by the statutory structure, reciprocal-benefit scheme, and our precedent, we hold TIC is entitled to rely on the Workers’ Compensation Act’s exclusive-remedy defense as Martin’s co-employee.
We reverse the court of appeals’ judgment and render judgment in TIC’s favor on its affirmative defense under section 408.001 of the Workers’ Compensation Act.
TEX. LAB. CODE § 408.001(a).
In this opinion, all references to “subcontractor” include the subcontractor’s employees.
Id. § 406.122(b).
Id. § 406.123(a), (e).
488 S.W.3d. 344 (Tex.App.–Corpus Christi 2015).
Id. at 349.
An OCIP is designed to secure insurance, including workers’ compensation insurance, at a reasonable price for all workers at a job site or construction site. Indep. Ins. Agents of Okla., Inc. v. Okla. Turnpike Auth., 876 P.2d 675, 676 (Okla.1994) (per curiam) (“Not only is a typical OCIP designed to reduce the cost of insurance premiums, it allows for a coordinated risk management and safety program for workers and visitors to the construction site. An OCIP also provides for insurance premium rebates to the policy owner for good construction safety records.”).
TEX. LAB. CODE § 408.001(a).
Id. § 406.123(a), (e).
Id. § 406.122(b).
Id. Subtitle A sets forth the bulk of the governing legislation. Id. §§ 401.001–419.007. Subtitle B governs workers’ compensation discrimination, and subtitle C includes special provisions applicable to a subset of governmental employees. Id. §§ 451.001–506.002.
See TEX. R. APP. P. 28.3.
488 S.W.3d at 344.
Id. at 349.
TEX. GOV’T CODE § 22.001(a)(1).
Id. § 22.001(e).
135 S.W.3d 764 (Tex.App.–Houston [1st Dist.] 2004, pet. denied).
373 S.W.3d 715 (Tex.App.–San Antonio 2012, pet. denied).
270 S.W.3d 666 (Tex.App.–San Antonio 2008, no pet.).
444 S.W.3d 824 (Tex.App.–Beaumont 2014, pet. denied).
Garza, 373 S.W.3d at 717.
Id. at 718.
Id. at 718, 720.
Id. at 721.
After oral argument in this case, the Ninth Court of Appeals issued Palmer confirms the uncertainty of the law as applied to agreements falling within the scope of both sections.
HCBeck, Ltd., 284 S.W.3d at 350.
See TEX. LAB. CODE § 408.001(a).
“ ‘Employer’ means, unless otherwise specified, a person who makes a contract of hire, employs one or more employees, and has workers’ compensation insurance coverage. The term includes a governmental entity that self-insures, either individually or collectively.” Id. § 401.011(18).
Id. § 406.122(a), (b) (emphasis added).
“ ‘General contractor’ means a person who undertakes to procure the performance of work or a service, either separately or through the use of subcontractors. The term includes a ‘principal contractor,’ ‘original contractor,’ ‘prime contractor,’ or other analogous term. The term does not include a motor carrier that provides a transportation service through the use of an owner operator.” Id. § 406.121(1).
“ ‘Independent contractor’ means a person who contracts to perform work or provide a service for the benefit of another and who ordinarily:
(A) acts as the employer of any employee of the contractor by paying wages, directing activities, and performing other similar functions characteristic of an employer-employee relationship;
(B) is free to determine the manner in which the work or service is performed, including the hours of labor or method of payment to any employee;
(C) is required to furnish or to have employees, if any, furnish necessary tools, supplies, or materials to perform the work or service; and
(D) possesses the skills required for the specific work or service.”
Id. § 406.121(2).
“ ‘Subcontractor’ means a person who contracts with a general contractor to perform all or part of the work or services that the general contractor has undertaken to perform.” Id. § 406.121(5).
Id. § 406.123(a), (e).
284 S.W.3d at 354.
Id. at 359.
Wingfoot Enters. v. Alvarado, 111 S.W.3d 134, 140, 142 (Tex.2003)).
State v. Shumake, 199 S.W.3d 279, 284 (Tex.2006).
City of San Antonio v. City of Boerne, 111 S.W.3d 22, 25 (Tex.2003).
Howard Oil Co. v. Davis, 76 Tex. 630, 13 S.W. 665, 666 (1890) (same).
See Shumake, 199 S.W.3d at 284.
See Garza, 373 S.W.3d at 721 (subcontractor and its employees are deemed fellow employees of the general contractor’s employees and, therefore entitled to exclusive-remedy defense).
See Wingfoot Enters. v. Alvarado, 111 S.W.3d 134, 134–35 (Tex.2003).
TEX. GOV’T CODE § 311.024.
In re United Servs. Auto. Ass’n, 307 S.W.3d 299, 307–08 (Tex.2010).
TEX. LAB. CODE § 406.121(2) (independent contractor defined), (5) (subcontractor defined).
An attorney for the appellant in Palmer v. Newtron Beaumont, L.L.C., No. 09–15–00248–V, 2016 WL 637926, at *1 (Tex.App.–Beaumont Feb. 18, 2016, pet. filed), filed an amicus brief providing additional arguments to support Martin’s construction of the statute.
TEX. LAB. CODE § 408.001.
Id. section 406.122, which provides the relevant definition of the term.
Shumake, 199 S.W.3d at 287.
In re Estate of Nash, 220 S.W.3d 914, 918 (Tex.2007).
In re City of Georgetown, 53 S.W.3d 328, 336 (Tex.2001).
HCBeck, 284 S.W.3d at 355 (discussing dissent’s position that “provid[ing] insurance” requires “put[ting] something in the pot” or “contribut[ing] something of value for statutory immunity”).
Cf. section 406.123 as disqualifying the premises owner from being a statutory employer would treat some employees “working side-by-side with the other contractors’ employees” differently with respect to remedies even if they were injured in the same accident and, “[u]nless the statute directs such a result, it makes no sense to read the statute in such an unreasonable manner”).
See TEX. GOV’T CODE § 311.025.