New Jersey Supreme Court reverses an appellate division decision employing an overly expansive interpretation of the premises rule.

As the petitioner’s employer, the respondent assigned the petitioner free parking at a private garage located about two blocks from her workplace. The respondent paid for 65 parking spaces for its employees at this private garage, provided each employee with a scan card so that they could gain access to the garage, and instructed all employees to park on the garage’s third level. On January 29, 2010, the petitioner parked her car on the third level of the parking garage and exited the building. As she was crossing the street, she was struck by a car and severely injured.

The petitioner filed a claim with the Division of Workers’ Compensation seeking medical and indemnity benefits. The respondent denied that the petitioner’s accident arose out of and in the course of her employment and invoked N.J.S.A. 34:15-36 of the New Jersey Workers’ Compensation Act.

The respondent argued that the garage was neither owned nor operated by the respondent and that, even if it was, the petitioner’s accident did not occur in the garage, but on a public street over which the respondent exercised no control.

At the conclusion of trial, the Judge of Compensation found that the petitioner’s accident was compensable as it happened after she had arrived at the parking garage designated for her use by the respondent. The judge rejected the respondent’s contention that the petitioner was no longer in the course of her employment when she entered the public street. “Because the employer chose a parking location that required petitioner to cross a busy thoroughfare,” the judge noted, “petitioner consequently lost the ability to decide where she wanted to park and assess the risks herself.” The respondent appealed.

In affirming the judge’s ruling, the Appellate Division relied on Livingstone v. Abraham and Strauss, Inc., 111 N.J. 89 (1988), in which the court found that an employee’s parking lot accident was compensable as her work day commenced when she arrived in her car at the section of the parking lot adjacent to her employer’s premises. The employer, a tenant in a large shopping mall, required its employees to park at the outer edge of the lot so that customers could park closer to the store. The fact that the employer did not own, maintain or have exclusive control of the parking lot did not preclude the accident from being compensable, as the Livingstone court reasoned that the term “control,” as used in N.J.S.A. 34:15-36, must be interpreted as simply “use by the employer in the conduct of his business.”

Applying the principle of Livingstone, the Appellate Division found that the petitioner’s accident was compensable under the Act. Although the garage and the sidewalk en route to the workplace were not part of the workplace in a physical sense, the respondent exercised control over these areas by designating the third floor of the garage for employees.

The Supreme Court granted the respondent’s petition for certification. In reversing the Appellate Division’s holding, the Supreme Court relied on a series of so-called “ingress and egress” cases. See Brower v. ICT Group, 164 N.J. 367 (2000); Ramos v. M & F Fashions, Inc., 154 N.J. 583 (1998); Ehrlich v. Strawbridge & Clothier, 260 N.J. Super. 89 (App. Div., 1992), cert. denied, 133 N.J. 435 (1993); and Novis v. Rosenbluth Travel, 138 N.J. 92 (1994). These cases support the principle that public places that are not under the control of the employer are not considered part of the employer’s premises for purposes of workers’ compensation benefits, even if employees use the route for ingress or egress to the place of employment, except in those instances where the employer controls the route. Unlike the limited routes to the places of employment in Brower, Ramos or Ehrlich, here, Hersh’s route to work was used by the public, similar to the route to the building in Novis.

The Supreme Court found that the Appellate Division misapplied the holding in Livingstone to the instant case. Of chief concern in Livingstone, the Supreme Court reasoned, was not the employer’s control of the parking lot, per se, but rather the added hazard employees were forced to endure by the employer while they walked through the parking lot. In Livingstone, the employer’s control over the parking lot required each employee to follow a specific ingress and egress route from the parking lot to the building, even though the parking lot was not owned by the employer, which made the injuries compensable. Here, the respondent exercised no such control over the petitioner’s ingress and egress route.

Case Law Alerts, 3rd Quarter, July 2014