Under Tennessee law, an injured worker’s exclusive remedy is generally against his or her employer under workers’ compensation. There are some exceptions. For example, you may have both a worker’s compensation claim and a negligence (or tort) claim against another party if that other party is separate from the employer. The Tennessee Supreme Court’s decision in Coblentz v. Tractor Supply Company clarified the limits of statutory employer status under Tennessee workers’ compensation law and resolved whether a retail store can be shielded from a negligence claim when an injured worker is employed by a product vendor rather than a service subcontractor.
The case arose after Brian Coblentz, an employee of Stanley National Hardware, was injured while servicing a product display inside a Tractor Supply store. Stanley National sold hardware products to Tractor Supply and sent employees like Coblentz to visit stores to check inventory, place orders, and maintain displays. After Stanley National paid workers’ compensation benefits, Coblentz and his wife sued Tractor Supply for negligence, alleging unsafe premises. Tractor Supply argued that it was Coblentz’s statutory employer under Tennessee Code Annotated section 50-6-113 and therefore immune from the lawsuit under the workers’ compensation exclusive remedy rule.
Because these exceptions can dramatically affect an injured worker’s rights, consulting with an experienced Knoxville workers’ compensation attorney is often essential when a third-party negligence claim may exist.
The central legal question was whether Stanley National qualified as a “subcontractor” of Tractor Supply, which would make Tractor Supply a statutory employer. The trial court and a majority of the Court of Appeals concluded that it did, emphasizing that the tasks Coblentz performed—stocking, organizing, and inspecting displays—were part of Tractor Supply’s regular business and similar to work performed by Tractor Supply’s own employees. On this reasoning, the lower courts held that the exclusive remedy provision applied and barred the negligence claim. A dissenting judge disagreed, warning that the courts were improperly expanding workers’ compensation law by treating a standard vendor–vendee relationship as a subcontracting arrangement.
The Tennessee Supreme Court reversed these rulings, holding that Tractor Supply was not Coblentz’s statutory employer. The Court explained that section 50-6-113 applies only to principal–subcontractor relationships involving the performance of labor or services, not to relationships primarily centered on the sale of goods. Because the statute does not define “subcontractor,” the Court examined dictionary definitions and historical usage from the time the statute was enacted. These sources consistently linked subcontracting to the performance of work or services, not to the sale or incidental delivery of merchandise. The Court emphasized that prior Tennessee cases relied on by Tractor Supply involved service contracts, not product vendors, and therefore did not control the outcome.
The Court also grounded its interpretation in the purpose of the workers’ compensation statute. Section 50-6-113 is designed to prevent businesses from avoiding workers’ compensation liability by contracting out their normal work to labor subcontractors. Extending the statute to cover product vendors, the Court reasoned, would go far beyond that purpose and could produce absurd results, such as exposing ordinary purchasers of goods to workers’ compensation liability simply because vendors’ employees enter their premises. The Court noted that its approach aligned with the overwhelming majority of other states, which similarly exclude vendor–vendee relationships from statutory employer coverage.
To address situations involving both goods and services, the Court adopted a “predominant purpose” test. Under this test, courts must determine whether the primary objective of the relationship is the sale of goods or the provision of services. Applying this framework, the Court found that the relationship between Tractor Supply and Stanley National was predominantly for the sale of hardware products. The in-store activities performed by Stanley National employees were incidental to that commercial purpose. As a result, Stanley National was not a subcontractor, Tractor Supply was not a statutory employer, and the workers’ compensation exclusive remedy provision did not bar Coblentz’s negligence claims.
It is important to hire a Knoxville personal injury lawyer that is experienced in both types of claims when there is potential for a workers’ compensation case and a negligence case.
Call one of our attorneys if that happens.