“Volunteers” Are Not Eligible for Worker’s Comp

Nonprofit and Church Legal Trends - Free Edition - March April 2009 (free edition)

The New Hampshire Supreme Court recently ruled that a “volunteer” for a nonprofit organization that supplied labor to the owner of a New Hampshire raceway is not eligible for workers’ compensation when injured on the job.

Application: This fundraising model appears to be fairly common for venue operators who need competent labor for short periods of time and charities which need funding. This case holds that the workers are not employees for workers’ comp purposes, at least under New Hampshire law but another state could have been just as reasonable in finding otherwise? This ruling raises serious questions of working with no insurance coverage, no coverage for unemployment tax purposes and no withholding taxes? Is the charitable organization generating unrelated business taxable income, or is the volunteer exception applicable? If the worker had injured a paying customer, the owner or the charity may have been liable but would probably not have had liability insurance. Would he have been protected from personal liability by volunteer protection laws?