The Iowa Court of Appeals considered a difficult case, Teen Challenge v. Pauler, where a 44-year-old man who was going through drug treatment was found not to be an employee, while repairing a building to be used by staff members of the program. Teen Challenge is a non-profit organization that relies on charitable donations to operate. Part of the program includes residents working on projects for what is called “character development.”

The Court noted that Mr. Pauler agreed to work on such projects, and was told that he could purchase health insurance coverage, since any injuries would not be covered by the program. He then sustained a serious knee injury, and Teen Challenge told him that they would not cover his health expenses.

At hearing before the State agency, the Deputy Commissioner held that this was not employment. The Commissioner reversed and held that it was covered. The Iowa District Court and the Court of Appeals found that this was not employment, and was not covered by the Iowa Workers’ Compensation Act.