The United States Court of Appeals for the Fifth Circuit in Owensby & Kritikos, Incorporated, et al. v. Director, Office of Workers’ Compensation Programs has applied the “substantial nexus test” established by the Supreme Court in Pacific Operators Offshore, LLP v. Valladolid, 565 U.S. 207 (2012) to hold that an employee who sustains an onshore injury en route to a platform on the Outer Continental Shelf may recover benefits under the Longshore and Harbors’ Compensation Act, 33 U.S.C. §901 et seq., as extended by the Outer Continental Shelf Lands Act, 43 U.S.C. § 1333(b).
The U.S. Supreme Court in Valladolid affirmed the Ninth Circuit’s decision expanding the reach of the Outer Continental Shelf Lands Act (OCSLA) for employees seeking workers’ compensation benefits from their employers and adopted the “substantial nexus” test to determine if an employee was covered under OCSLA and thus receive the greater benefits of the federal Longshore Act. This analysis requires a two-part inquiry:
- Did the injury arise out of, and occur within the scope of, his employment, under LHWCA’s relevant provision 33 U.S.C. § 902(2)?
- Was the injury sustained as the result of operations conducted on the Outer Continental Shelf, under OCSLA’s relevant provision, 43 U.S.C. § 1333(b)?
Owensby & Kritikos, Incorporated, et al. v. Director, Office of Workers’ Compensation Programs – Background
The facts of Owensby were undisputed. The employee, James Boudreaux, who over the last year of employment spent 89% of his work time offshore, was driving to Fresh Water, Louisiana to be taken offshore when he was involved in a vehicular collision caused by a third party. As a result, the employee sustained severe injuries. Among the relevant facts, the court found persuasive: Employee was compensated by Employer for both time and onshore mileage while traveling to and from the OCS; Employee was on-the-job when he was injured; Employee necessarily traveled to an intermediary pickup location to be transported from onshore to the OCS; and Employee carried his testing equipment in his vehicle; and Employer had another employee pick up the testing equipment to take it to the OCS after his accident.
The parties agreed Boudreaux was in the course and scope of his employment, satisfying the first inquiry of the analysis. The only issue, a question of law, was whether the injury was sustained as the result of operations conducted on the OCS. The claim was submitted to an Administrative Law Judge, who held in favor of the employee and awarded LHWCA benefits.
U.S. Court of Appeals for the Fifth Circuit Ruling
The Fifth Circuit panel noted that the Supreme Court, while rejecting the Third Circuit’s “but-for test” in Valladolid, “did not bar holding covered an injury resulting from an onshore accident while an employee was traveling onshore to go offshore.” The panel also unanimously rejected the employer’s interpretation of Valladolid that the employee must prove a substantial nexus between the employer’s work and the accident. OCSLA only requires a substantial link between the injury and shelf operations.
Owensby & Kritikos, Incorporated, et al. v. Director, Office of Workers’ Compensation Programs, (No. 19-60619, CV; 2021 WL 1940599 [5th Cir. May, 14, 2021])