When is a 'non-profit' volunteer fire department itself an OSHANC-covered employer, and what factors should the Department of Labor weigh in deciding?

Plain-English summary

In November 1993, NC Department of Labor Deputy Commissioner Charles N. Jeffress asked the AG to identify the factors for determining whether a non-profit volunteer fire department is an OSHANC employer, independent of the November 17, 1993 opinion's separate question about municipal control. The December 21, 1993 follow-up opinion answers that.

Senior Deputy AG Reginald L. Watkins and Associate AG Marvealavette D. Jackson Francis identified compensation as the principal factor.

Statutory framework. OSHANC's employer definition in N.C.G.S. § 95-127(10) is "a person engaged in a business who has employees, including any state or political subdivision of a state, but does not include the employment of domestic workers employed in the place of residence of his or her employer." The employee definition in § 95-127(9) means "an employee of an employer who is employed in the business or other capacity of his employer, including any and all business units and agencies owned and/or controlled by the employer."

Compensation is the principal factor. Per City of Fort Calhoun v. Collins (Neb. 1993) and Smith v. Berks Community Television (E.D. Pa. 1987), volunteer firefighters who contribute service on a "purely voluntary basis" without compensation are not employees. The corollary is that if any member receives compensation, the department becomes an OSHANC employer.

The threshold is "one or more members." Even a single paid member is enough to make the department an OSHANC employer. The reasoning: the statutory definition refers to "an employer who has employees," and "employees" in the plural would seem to require more than one. But the AG's reading (consistent with federal practice) is that a single paid member is sufficient to attach OSHANC coverage to the department, including for its volunteer members.

What counts as compensation. N.C.G.S. § 95-25.2(16) defines compensation broadly as wages, including sick pay, vacation pay, severance pay, commissions, bonuses, and other amounts promised. This wage-and-hour definition imports straightforwardly to OSHANC employer analysis.

Workers' comp and disability insurance alone are not compensation. This is a useful carve-out. A department that provides workers' compensation or disability insurance to cover injuries sustained while firefighting does not, by virtue of that insurance alone, become an OSHANC employer. The AG's reasoning: a volunteer firefighter receives no benefit from the insurance unless injured. So insurance is contingent compensation, not regular compensation. City of Fort Calhoun v. Collins is cited for the proposition that workers' compensation benefits do not, by themselves, create an employer-employee relationship.

This carve-out is significant operationally. Many volunteer departments provide workers' compensation or disability insurance because their members are exposed to serious risk and reasonable insurance is a humane practice. The carve-out lets them do so without inadvertently becoming OSHANC employers (and absorbing the corresponding compliance burden).

If the department is an OSHANC employer. It must comply with all OSHANC requirements: a safe workplace, hazard-free conditions, compliance with safety standards, citation and penalty exposure for violations. Per Secretary of Labor v. Poughkeepsie Yacht Club, an unincorporated association or non-profit can be cited for violations affecting paid employees. The opinion suggests that the volunteer fire department can be cited if "any paid employee is exposed, or potentially exposed, to the hazard." That phrasing implies that the employee-exposure trigger matters: if only volunteers are exposed (no paid members exposed), no OSHANC liability attaches even at a department that is technically covered because of one paid member.

If the department is NOT an OSHANC employer. If no members receive compensation, the department is not an OSHANC employer and faces no OSHANC citations or penalties.

Section 95-148 exemption from safety-program requirements. § 95-148 imposes specific safety-program requirements on state and local governmental entities. Volunteer fire departments not part of a municipality are exempted from the safety-program requirement. But the other provisions of OSHANC still apply to any volunteer fire department determined to be an employer. Per 29 C.F.R. § 1975.4(b)(4) (1992), the same is true at the federal level. The "is the department part of a municipality" question is the subject of the November 17, 1993 opinion's control analysis.

Two distinct questions. The opinion reinforces that the two AG opinions answer different questions:

• November 17, 1993: Is the volunteer fire department part of a municipality/county for the § 95-148 safety-program requirement? Test: control by municipality (five factors, clear and convincing evidence).
• December 21, 1993: Is the volunteer fire department itself an OSHANC employer? Test: compensation of one or more members.

The two analyses can produce overlapping or distinct results. The fact patterns matter.

Currency note

This opinion was issued in 1993. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. OSHANC has been amended multiple times since 1993. The OSHANC wage-and-hour definitions in Chapter 95 have evolved. Federal OSHA precedent on volunteer firefighter classification has continued to develop. Anyone advising a volunteer fire department or municipality today should consult current statutes and current case law.

Background and statutory framework

Volunteer fire departments are mostly non-profit corporations or unincorporated associations chartered under state non-profit law. Their structures vary widely: some have a few paid administrative or maintenance staff and many volunteer firefighters; some are entirely volunteer; some are quasi-municipal organizations operating under contract with cities or counties.

The compensation question reflects an underlying tension in federal and state employment law. Volunteers are not employees in the ordinary sense, so volunteer service should not trigger employment-law obligations. But when a "volunteer" gets paid (even nominally), the volunteer character can erode. Courts have generally drawn the line at any compensation: receiving payment converts the relationship to employment, even if the payment is below market or is structured as a stipend.

The exception for workers' compensation and disability insurance is a sensible accommodation. These insurance coverages exist to protect the firefighter and the family in case of injury. They serve a humanitarian purpose. Excluding them from "compensation" preserves the volunteer-protection function without disturbing the volunteer character of the service.

The Poughkeepsie Yacht Club case (cited) is one of the federal OSHRC precedents on volunteer organizations as OSHA employers. The federal Review Commission has generally found that paid employees of an otherwise-volunteer organization create OSHA coverage for the organization, with citations possible for violations exposing the paid employees. Volunteers themselves are not OSHA-protected at the organizational level; their protection comes through state law if at all.

The AG's reading is faithful to this federal jurisprudence. It also gives volunteer fire departments clear guidance: if you want OSHANC-free volunteer status, do not pay anyone. If you have at least one paid member, you become an OSHANC employer with the corresponding obligations.

Common questions

What if a volunteer fire department pays only its chief, not the rank-and-file firefighters?

Per the AG's analysis, this would make the department an OSHANC employer. The chief is a paid employee. The department is then subject to OSHANC requirements, and citations are possible for hazards exposing the chief. Whether the volunteer rank-and-file firefighters are also OSHANC-protected at the department level depends on further analysis; the federal practice would likely focus on paid-employee exposure as the trigger.

What if the department pays its members nominal amounts ($5 per fire call)?

Probably still a paid relationship. The AG's analysis treats compensation broadly, citing the wage-and-hour definition that includes "any amounts promised." Nominal payments would constitute compensation. The department would be an OSHANC employer.

What about stipends for training or travel?

The opinion does not explicitly address stipends. The wage-and-hour definition includes "amounts promised" generally, and stipends for training or travel could be analyzed as compensation. Federal precedent on stipends is mixed; the AG would likely consider the structure and purpose of the payment.

Can a department avoid OSHANC by terminating paid positions and going fully volunteer?

Yes, prospectively. If the department restructures so no member receives compensation, it would no longer be an OSHANC employer. Of course, the practical question is whether fully-volunteer operation is feasible (often it requires significant paid administrative or maintenance support for any sustainable fire department).

Source

• Landing page: https://ncdoj.gov/opinions/applicability-of-the-occupational-safety-and-health-act-of-north-carolina-3/

Citations

• N.C.G.S. § 95-127(9)
• N.C.G.S. § 95-127(10)
• N.C.G.S. § 95-129
• N.C.G.S. § 95-148
• N.C.G.S. § 95-25.2(16)
• N.C.G.S. § 58-87-1(b)(2) (1991)
• 29 C.F.R. § 1975.3(d) (1992)
• 29 C.F.R. § 1975.4(b)(4) (1992)
• City of Fort Calhoun v. Collins, 500 N.W.2d 822 (Neb. 1993)
• Smith v. Berks Community Television, 657 F. Supp. 794 (E.D. Pa. 1987)
• Stuart v. Faulk, 426 N.E.2d 443 (1981)
• Secretary of Labor v. Arlie R. Hawk, 1976-1977 OSHD 20,707, OSHRC Docket No. 6688 (May 19, 1976)
• Secretary of Labor v. Poughkeepsie Yacht Club, Inc., 1979 OSHD 23,888, OSHRC Docket No. 76-4026 (Sept. 17, 1979)

Original opinion text

December 21, 1993

Charles N. Jeffress
Deputy Commissioner/Director
Division of Occupational Safety and Health
North Carolina Department of Labor
412 North Salisbury Street
Raleigh, North Carolina 27603-5952

Re: Advisory Opinion; Applicability of the Occupational Safety and Health Act of North Carolina, Article 16 of Chapter 95 of the General Statutes of North Carolina, to Volunteer Fire Departments; N.C. Gen. Stat. §95-148.

Dear Mr. Jeffress,

In your November 23, 1993 memorandum, you asked us to examine what factors should be considered in determining an employer-employee relationship between a "non-profit" volunteer fire department and its members.

In order for a volunteer fire department to be covered by the North Carolina Occupational Safety and Health Act (the Act), it must be an employer. N.C. Gen. Stat. §95-129 (1989) imposes certain duties on employers by providing among other things the following: "(1) [e]ach employer shall furnish to each of his employees conditions of employment and a place of employment free from recognized hazards that are causing or are likely to cause death or serious injury or serious physical harm to his employee. . . (2) [e]ach employer shall comply with occupational safety and health standards or regulations promulgated pursuant to this Article. . .."

Insofar as the duties of section 95-129 are duties of each employer, the question of who is an employer under the statute is a crucial matter of statutory construction. 27 ALR Fed. 943 §2; 29 CFR 1975.3(d) (1992). The definition of "employer" found in N.C. Gen. Stat. §95-127(10) (1989) is as follows:

"(10) The term 'employer' means a person engaged in a business who has employees, including any state or political subdivision of a state, but does not include the employment of domestic workers employed in the place of residence of his or her employer."

The term employee as defined by N.C. Gen. Stat. §95-127(9) (1989) means:

"(9) . . . an employee of an employer who is employed in the business or other capacity of his employer, including any and all business units and agencies owned and/or controlled by the employer."

Any employer employing one or more employees would be an "employer," and therefore, is covered by the Act. 27 ALR Fed 943 §1[c].

Because of the varied nature of fire departments in North Carolina, the question of whether a volunteer fire department is an employer as contemplated by the Act, i.e. whether there is an employer-employee relationship between the volunteer fire department and its members, must be determined on a case-by-case basis. The principal factor to be considered in determining whether the volunteer fire department is an employer is whether members of the volunteer fire department receive compensation for their services, as opposed to their contributing assistance on a purely voluntary basis. See City of Fort Calhoun v. Collins, 500 N.W.2d 822, 826 (Neb. 1993) (quoting Smith v. Berks Community Television, 657 F. Supp. 794 (E.D. Pa. 1987)); Stuart v. Faulk, 426 N.E.2d 443 (1981); Secretary of Labor v. Arlie R. Hawk, 1976-1977 OSHD 20,707, OSHRC Docket No. 6688 (May 19, 1976); see also, N. C. Gen. Stat. §58-87-1(b)(2) (1991). Where one or more members receive compensation, an employer-employee relationship exists. Conversely, where none of the members receive any compensation, an employer-employee relationship does not exist.

Generally, compensation is defined as wages, including sick pay, vacation pay, severance pay, commissions, bonuses, and other amounts promised. See N. C. Gen. Stat. §95-25.2(16) (1989). Providing workers' compensation or disability insurance, however, should not be sufficient, standing alone, to create an employer-employee relationship. Although workers' compensation and disability insurance constitute "benefits" which arguably amount to a form of compensation, a volunteer fireman receives no benefit from them unless injured while working as a volunteer firefighter. For this reason, at least one jurisdiction has held that the furnishing of workers' compensation benefits to volunteer firemen does not create an employee-employer relationship. See City of Fort Calhoun v. Collins, 500 N.W.2d at 824.

Clearly, if the volunteer fire department is deemed to be an employer for purposes of the Act, it must comply with the Act and is responsible for citations and penalties resulting from any violations of the Act. See Secretary of Labor v. Poughkeepsie Yacht Club, Inc., 1979 OSHD 23,888, OSHRC Docket No. 76-4026 (Sept. 17, 1979). Thus, if a violative condition is found, the volunteer fire department may be cited if any paid employee is exposed, or potentially exposed, to the hazard created by the condition. On the other hand, if the volunteer fire department consists of members who contribute assistance on a purely voluntary basis and receive no direct or indirect compensation, the volunteer fire department is not an employer as defined by the Act, and as such, is not responsible for citations and penalties resulting from any violations of the Act. See City of Fort Calhoun v. Collins, 500 N.W.2d at 826.

The only provisions of the Act that exempt volunteer fire departments from any requirements of the Act are found in N.C. Gen. Stat. §95-148 (1989). This section, which applies to state and local governmental entities, is limited in scope. Specifically, this section requires state agencies and local governments to establish and maintain specific safety and health programs. Volunteer fire departments not a part of a municipality are exempted from this requirement. However, all other provisions of the Act would apply to any volunteer fire department determined to be an employer, which includes non-profit organizations. 29 CFR 1975.4(b)(4) (1992).

In our advisory opinion of November 17, 1993, we discussed the conditions which, if shown to exist, would make a volunteer fire department part of a municipality for purposes of N.C. Gen. Stat. §95-148 (1989). While the economic relationship between a volunteer fire department and its members is key to determining whether the volunteer fire department is an employer under N.C. Gen. Stat. §95-129 (1989), the operative element in the relationship between the volunteer fire department and the municipality under N.C. Gen. Stat. §95-148 (1989) is control.

We hope that the above information answers any further concerns that you may have regarding the applicability of the North Carolina Occupational Safety and Health Act to volunteer fire departments. If we can be of any further assistance, please do not hesitate to contact us.

Reginald L. Watkins
Senior Deputy Attorney General

Marvealavette D. Jackson Francis
Associate Attorney General