Page 14: of Marine News Magazine (December 2010)

13 15

14 MN December 2010

LEGAL PERSPECTIVES

Historically in our industry, there has been a clear dichotomy between com- panies whose employees are seamen that are covered by the Jones Act and those that are longshoremen and cov- ered by the Longshore and Harbor

Workers’ Compensation Act (LHWCA). The difference was very sim- ple, Jones Act employers and their seamen were responsi- ble for vessel-based duties and operations. Longshore employers hired longshoremen that were land-based although they performed a portion of their duties aboard vessels. However, as with many of the issues that are ger- mane to the industry, the determination as to whether your employees are longshoremen or seamen has, due to changes in the industry, become more difficult to make.

Although the determination of the status of your employees may not be important to the day-to-day oper- ation of the company, it is critically important that you know how your employees are classified so that you can plan accordingly by knowing the duty owed to the people working on your vessels, procuring proper insurance and managing your employees’ medical and wage issues after an incident. For example, a Jones Act employer would rely upon its maritime employer liability insurance policy to provide coverage for injuries to a Jones Act seaman.

Whereas, a longshore employer would rely on its

Longshore and Harbor Workers’ Compensation Act insurance policy to provide medical care and lost wages to its employee.

If an employer incorrectly designates its longshore employees as seamen and does not purchase a LHWCA policy, the company could be left without coverage for an employee’s injury. Conversely, if a longshore employer incorrectly believes that its employees are seamen and pur- chases a maritime employers’ liability policy, but not a

LHWCA policy, it could also be left bare and without insurance coverage for an employee’s injury. In addition to seaman status determining which insurance policy pro- vides coverage for an incident, seaman status also invokes different standards of care applicable to both the employ- er and vessel owner.

It is important to first understand the difference between a seaman and a longshoreman. An employee is determined to be a seaman under the Jones Act if he or she is permanently assigned to and a member of the crew of a vessel or a fleet of vessels. Seaman status extends to employees while on shore, if the employee was, at the time, an employee of the vessel and engaged within the course and scope of his employment at the time of the incident.

Under the Jones Act, a seaman who suffers an injury has three potential remedies against his or her employer. All three of these claims are usually insured by a maritime employers’ liability policy. These claims include (1) a claim for maintenance and cure that is not based upon a claim for negligence, (2) a cause of action for the unsea- worthiness of the vessel and (3) a cause of action for neg- ligence. As maintenance and cure are not fault-based and provide workers’ compensation style benefits, a seaman’s claim against the employer for unseaworthiness and negli- gence places the seaman at an advantage against his or her employer by being able to bring both a fault-based claim against its employer and a claim for wage and medical benefits, which is traditionally prohibited in other employment settings.

On the other hand, under the Longshore and Harbor

Workers’ Compensation Act, shore-based employees are entitled to benefits for injuries that may have been suf-

If your company purchases both maritime employer liability and longshore coverage, you will be adequate- ly covered in the event of an incident to an employee regardless of the determination of seaman status.

However, if your company has purchased only longshore coverage or just a maritime employer liability policy it is important to take a close look at the tasks performed by your employees to make sure that you are acquiring the proper coverage.

The Zone of Uncertainty

Seaman or Longshoreman

By Lawrence R. DeMarcay, III