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Correct Construction Company, Inc. v. Industrial Commission

September 01, 1999


The opinion of the court was delivered by: Justice Rakowski

Appeal from the Circuit Court of Cook County.

Honorable Thomas P. Quinn Judge Presiding.

Claimant Michael R. Beltz, an Illinois resident, sought benefits pursuant to the Workers' Compensation Act (Act) (820 ILCS 305/1 et seq. (West 1994)) for injuries sustained on October 10, 1994, at an Indiana jobsite while in the employ of Correct Construction Company, Inc. (Correct). The arbitrator found that Illinois had jurisdiction over this matter and determined that Beltz suffered 20% permanent loss of the use of his right hand. The Industrial Commission of Illinois (Commission) affirmed the arbitrator's finding of Illinois jurisdiction but modified claimant's award, finding that he suffered only 12 1/2% permanent loss of the use of his right hand. The circuit court confirmed the decision of the Commission.

On appeal, Correct contends that the last act necessary to form an employment contract was its decision to hire claimant, which occurred at the jobsite in Indiana, and not claimant's telephone acceptance of the Union's employment referral. We agree and therefore reverse the judgment of the circuit court.


Claimant, a pipe fitter, belonged to the Pipe Fitters Association, Local Union 597 (the Union). The Union's primary hiring hall was located in Chicago, Illinois, but it also operated a satellite hall in Hammond, Indiana. As a Union member, claimant could not independently look for work but was required to follow the Union's procedure for securing employment. According to claimant, a Union member could go to either the Chicago or Hammond hiring hall to sign up on the out-of-work list.

With respect to this particular project, claimant testified that he was at his home in Illinois when the Union business agent from the Hammond hiring hall contacted him regarding an available job at Correct. The jobsite was at the Amoco plant located near Whiting, Indiana. Claimant informed the business agent that he would accept the position and arrived at the jobsite around 7 a.m. the following day. Upon checking in, claimant was given an application for employment and tax forms to fill out. He also provided Correct with his drug screening card. However, he did not recall attending a safety conference, receiving paperwork regarding safety requirements, or signing a "Contractor Safety Committee, Hazard Communication Training Record." According to claimant, after he filled out the application he was assigned to work, though he did not recall what time that was.

Edwin Patz, the business agent for Pipe Fitters Local 597, testified that he primarily works out of the Hammond office but he also works at the Chicago office at least one evening a week. His duties include working with and interpreting various agreements between the Union and contractors that govern hiring procedures. According to Patz, claimant's work at the Amoco plant fell within the scope of either the "Industrial Maintenance Agreement," which governs maintenance of existing construction, or the "Area Agreement," which governs new construction. In 1994, the hiring hall procedures were amended. Patz testified that the amendments to the Industrial Maintenance Agreement and the Area Agreement are identically worded and do not conflict with each other. Collectively, these documents contain the hiring procedures to which the Union and Correct agreed.

According to Patz, the hiring agreements provided that a contractor was required to hire members through the hiring hall unless the contractor was hiring a supervisor or hiring on an emergency basis at a time when the hiring hall was closed. In describing how the agreements were generally implemented, Patz stated that an individual Union member filled out a form stating his qualifications and other pertinent information, and was then placed on the out-of-work list. That information is then entered into the computer system, which lists the names according to the date and time the member signed up. A member must sign up in person, but he can sign up at the Chicago hall and still be hired out of the Hammond hall. Both hiring halls operate from the same out-of-work list, and a member need not personally go to Hammond to be hired from that hall.

A contractor may request a specific individual if that person has worked for the contractor within the preceding year. Generally, a contractor faxes the hiring hall a form indicating the position and the necessary job qualifications. The computer then matches this request with the first person on the out-of-work list whose qualifications meet the contractor's requirements. Patz would then call the Union member who was selected and determine whether that member was willing to accept the position. Finally, Patz would fax the contractor and provide it with the name of the individual who accepted the job. According to Patz, when a Union member reports to a jobsite, he usually must fill out and sign certain forms, including forms pertaining to safety regulations and drug testing. He did not know whether a member usually had to fill out an employment application. Pursuant to the hiring agreement, a member should be paid for the time he spends filling out such paperwork, though Patz did not know whether members actually were paid for this time.

Patz acknowledged that the 1994 amendment to the "Hiring Hall Area Agreement" provided that the "employer shall have the sole and exclusive responsibility for hiring" and that the "[e]mployer shall have the sole and exclusive right of accepting or rejecting applicants for work." The amendment also provided:

"A person that accepts an employment referral but who is not employed by the employer shall not receive show-up pay or any other compensation." Patz stated that Union members who go to a jobsite must comply with the employer's hiring requirements such as safety, drug testing, and experience. However, he denied that the contractor could, "at any time," reject an "employee" based on the hiring agreement. According to Patz:

"[I]f the man is supposed to start at 7:00 o'clock and he shows up, and up until 7:00 o'clock the employer comes and says regardless of the reason I am not going to employ you, he does not have to pay show-up time. He has the right of refusal. If it's after starting time it's too late."

Patz also testified that an employer can refuse to "hire" an "employee" who does not report to the jobsite with the necessary documents or credentials. In that situation, the "employee" is not entitled to receive show-up pay.

In this case, Patz stated that Correct was informed that claimant would be sent to the jobsite. Patz acknowledged that contractors have refused to hire referred Union members after receiving the fax indicating the name of the individual referred. He also admitted that contractors have occasionally rejected referred members after the individual ...

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