Eleventh Circuit Issues Important Labor Decision
On February 3, 2016, the Eleventh Circuit Court of Appeals issued an important decision pertaining to the employment status of individuals referred by one company to work at events sponsored by another company. According to the Court, such individuals are independent contractors, not employees; therefore, neither the individuals nor the referrals companies, are subject to the rules and regulations proscribed by the National Labor Relations Board (“NLRB”).
The referral company in question, Crew One Productions (“Crew One”), refers stagehands to event producers for concerts, plays, graduations, sporting events, trade shows, and religious events in the Atlanta area. In overturning the NLRB’s ruling (that the stagehands were Crew One employees), the Eleventh Circuit noted the long-settled view that agency law governs employment status determinations.
In its discussion of agency law, the Court listed several relevant factors used to determine whether an individual worker is an employee or an independent contractor:
- The extent of control which, by the agreement, the master may exercise over the details of the work;
- Whether or not the one employed is engaged in a distinct occupation or business;
- The kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision;
- The skill required in the particular occupation;
- Whether the employer of the workman supplies the instrumentalities, tools, and the place of work for the person doing the work;
- The length of time for which the person is employed;
- The method of payment, whether by the time or by the job;
- Whether or not the work is a part of the regular business of the employer;
- Whether or not the parties believe they are creating the relation of master and servant; and
- Whether the principal is or is not in business.
Of these, said the Court, the level on control is the most determinative.
Turning to the facts of the case, the Court found that Crew One does not have the right to exercise control over the stagehands. Although Crew One requires stagehands to check in and check out of particular jobs, that requirement “evinces control over the ends of the job, not the means of it.” All control over the means of the particular job remains with the Crew One client who requested the stagehand. As the Court noted, “Crew One lacks the expertise to direct the stagehands in their work for any particular client.”
Moreover, the Court found that Crew One’s failure to withhold taxes is strong evidence that the stagehands are independent contractors. The Court also held that the stagehand contracts with Crew One, which were independent contractor agreements, were indicative of Crew One’s intent to treat the stagehands as independent contractors. Likewise, the fact that stagehands negotiated pay rates with Crew One did not indicate an employer-employee relationship. Finally, the Court noted that the work performed by the stagehands is not an “essential function” of Crew One’s business; indeed, the work performed by the stagehands is an essential function of the work of the particular Crew One client.
The case is Crew One Productions v. NLRB, 2016 WL 403201 (11th Cir. 2016).
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