Goulding v. NJ Friendship House, Inc., ___ N.J. ___ (2021). This opinion by Justice Fernandez-Vina today, for a unanimous Supreme Court, dealt with a claim under the Workers Compensation Act. Plaintiff was employed as a cook by defendant, a non-profit that assists persons with developmental disabilities. Defendant hosted a “Family Fun Day” for its clients, outside working hours, at which plaintiff volunteered to work. During the day, she stepped in a pothole in a parking lot and injured her ankle. Despite that, she continued to work, helping other cooks prepare food while keeping her foot elevated. Later, plaintiff filed for workers’ compensation.
As Justice Fernandez-Vina stated, under N.J.S.A. 34:15-7, “an injury ‘arising out of and in the course of employment’ is not compensable if it is sustained during ‘recreational or social activities.’” Moreover, there is an exception to that exception. Under that same statutory section, an injury will be covered if “such recreational or social activities [1] are a regular incident of employment and [2] produce a benefit to the employer beyond improvement in employee health and morale.”
The statute does not define “recreational or social activities.” The Workers’ Compensation court found that the “Family Fun Day” was a recreational or social activity, and that the exception did not apply. Plaintiff was not injured while working, but while in the parking lot, and because there was no fundraising or marketing involved in the event, there was no benefit to defendant beyond an improvement to employee health or morale. The Appellate Division affirmed that ruling.
Today, however, the Supreme Court reversed, applying de novo review to the statutory interpretation issue presented and noting that the Workers Compensation Act “is humane social legislation designed to place the cost of work-connected injury upon the employer who may readily provide for it as an operating expense.” Thus, courts “liberally construe the Act to implement the legislative policy of affording coverage to as many workers as possible.”
After discussing the history that led to the enactment of N.J.S.A. 34:15-7, which was enacted in 1979, Justice Fernandez-Vina held that the “Family Fun Day” was not a recreational or social activity. “If an employer-sponsored event is designed with the purpose of benefitting the employer’s clients, members, or customers, and an employee volunteers to help facilitate the event, the event cannot be deemed a social or recreational activity as to that employee. Moreover, although Family Fun Day as a whole may have been a social or recreational event, Goulding did not participate in that event in a social or recreational role because she was there to help facilitate it. The statute applies to ‘recreational or social activities‘ –not ‘recreational or social events‘” (emphases by Justice Fernandez-Vina).
Justice Fernandez-Vina noted that the Court’s analysis “could end there.” But the Court went on to hold that both prongs of the exception to the exception were met, so that plaintiff’s injury would have been compensable even if she had been engaging in a recreational or social activity. Though plaintiff was injured at the very first “Family Fun Day” held by defendant, that event “was designed to be a recurring ‘annual’ event. Indeed, Family Fun Day can be considered ‘customary’ just like a lunch, coffee, or cigarette break and was sufficiently related to the employment.” Thus, the first prong of the exception to the exception was satisfied. Justice Fernandez-Vina distinguished Sarzillo v. Turner Construction Co., 101 N.J. 114 (1985), a case where an employee was injured while playing a game during a lunch break, a “spontaneous and sporadic” incident with no connection to work.
As to the second prong of the exception to the exception, “there is little evidence to suggest Family Fun Day improved employee health and morale, especially considering there is nothing in the record suggesting employees and their families were invited to attend as guests. Any benefit the event had to employee health and morale was incidental to the event, not the driving force behind it.” Additionally, the event “had the stated purpose of celebrating clients or members, their families, and the community. An obvious side effect of that is there will be those who rightfully think that Friendship House is doing good work and will be more inclined to help out in whatever way they can as a result of that favorable impression.” Defendant thus received a benefit even though the event was not a fundraiser.
Accordingly, the Court reversed and remanded the matter to the compensation court for further proceedings.