A vast majority of New Jersey's municipalities offer volunteer positions within their communities. These volunteer opportunities are routinely coordinated and managed through a municipality. Whether one serves as a volunteer at a senior center, at a library, at a special event such as a community day, maintaining local gardens or at an animal shelter, volunteer opportunities are abundant throughout the state. It is indisputable that volunteers provide valuable functions for municipalities as well as the people they serve. But what are the obligations of a municipality if a volunteer gets hurt while volunteering? Does this trigger the New Jersey Workers' Compensation Act N.J.S.A. 34:15 et seq.? This question is not only relevant to the municipal attorney who most likely will get the first call from the municipality, but also for the attorney from whom the injured volunteer seeks assistance.

The question of whether municipal volunteers are covered by the New Jersey Workers' Compensation Act, should an injury occur in the course of volunteering activities, turns on the definition of "employee."

N.J.S.A. 34:15–36 defines "employee" as "synonymous with servant, and includes all natural persons, including officers of corporations, who perform service for an employer for financial consideration …." (Emphasis added.)

Service performed in exchange "'for financial consideration' is a cardinal legal requirement in [workers'] compensation for the creation of the status of employer and employee." Goff v. County of Union, 26 N.J. Misc. 135, 138 (Dept. Labor 1948). That services be rendered for "financial consideration" has been recognized as "the primary governing standard defining an  employee[.]" Kraivanger v. Radburn Assoc., 335 N.J. Super. 169, 172 (App. Div. 2000); Gross v. Pellicane, 65 N.J. Super. 386, 395 (Cty. Ct. 1961) ("a prerequisite to the existence of an employment status is that there be a financial consideration flowing between the employer and the employee.").

Financial consideration, under the statute, need not be in the traditional form of a wage. Johnson v. The United States Life Ins. Co., 74 N.J. Super. 343, 349–50 (App. Div. 1962). For instance, free board and lodging, or a rent-free apartment have been held to constitute consideration given in return for services rendered. See Britten v. Berger, 18 N.J. Misc. 215 (Dept. Labor 1940); Simpson v. Vertty, 3 N.J. Misc. 9 (Dept. Labor 1925). In addition, benefits such as vocational instruction, training, and incidental equipment have also been deemed compensation. Heget v. Christ Hosp., 26 N.J. Misc. 189, 192 (Cty. Ct. 1948) (finding that a student nurse was an employee of a hospital even though she did not receive wages for her work).

Notably, "employee status for workers' compensation purposes exists if any financial consideration at all passes." (emphasis added) Kraivanger, 335 N.J. Super. at 172. In short, "financial consideration" includes anything of value to be received by the individual in return for his services, but not the hope of future favors. Hawksford v. Steinbacher Packing Co., 73 N.J. Super. 175, 180 (Cty. Ct. 1962), aff'd, 80 N.J. Super. 129 (App. Div.), certif. denied, 41 N.J. 195, 195 (1963).

"It is clear that one who volunteers his [or her] services and neither receives nor expects to receive payment is not an employee for workers' compensation purposes." Veit v. Courier Post Newspaper, 154 N.J. Super. 572, 574 (App. Div. 1977) (citing Cerniglia, 50 N.J. Super. 201; Armitage v. Trs. of Mt. Fern M.E. Church, 33 N.J. Super. 367 (Cty. Ct. 1954); 1A Larson, Workmen's Compensation Law, §47.41 (1973)). The Cerniglia court noted that "[t]he [workers'] compensation decisions uniformly exclude from the definition of 'employee' those who neither receive nor expect to receive any kind of pay for their services." Cerniglia, 50 N.J. Super. at 208 (citing 1A Larson, §47.41 at 696).

The evident question that is raised relates to the rhetorical "grey area" in respect to volunteering. Specifically, what if a volunteer receives some kind of "token" type of gift or compensation for provided volunteer services? This is usually the case with many volunteer posts. For example, maybe each time a person volunteers, he or she is given a free ticket to a movie or local band performance, maybe even something as minor as a coupon for a local business. There are many types of gifts that volunteers are given upon the completion of a volunteer activity. This poses the question of whether these "token" types of gifts rise to the level of consideration in exchange for services, making a municipal volunteer an "employee" for purposes of the New Jersey Workers' Compensation Act.

It is fairly clear that the intent of the law is to create a "bright-line rule." Specifically, if any financial consideration at all passes to a volunteer, whether in the traditional form of a wage or non-traditional form as something else of value, the status of a volunteer becomes the status of an employee of a municipality for the purpose of the New Jersey Workers' Compensation Act.

From the perspective of a municipal attorney, it would be prudent to advise a municipal client not to compensate volunteers in any form, or there could be exposure to Workers' Compensation liability should a volunteer become injured in the course of his or her volunteer activities. Although this position may not be the "warm and fuzzy" position to take with respect to volunteers, it could save a municipality from an unexpected legal problem.

Alternatively, from the perspective of an attorney potentially representing a volunteer who has sustained an injury in the course of volunteer duties, it would be imperative for that attorney to first review whether consideration of any kind is received for these services. If any consideration is made, the inquiry then goes further as to whether the volunteer "expects" to receive this consideration for his or her services.

Jonathan E. McMeen is the chair of the Laddey, Clark & Ryan Workers' Compensation Practice Group, which primarily focuses on petitioner cases. He is based in the firm's Sparta office.