Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-12-56589/USCOURTS-ca9-12-56589-0/pdf.json

Nature of Suit Code: 710
Nature of Suit: Fair Labor Standards Act
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

FERNANDO RUIZ, individually and on

behalf of all others similarly

situated,

Plaintiff-Appellant,

v.

AFFINITY LOGISTICS CORPORATION,

Defendant-Appellee.

No. 12-56589

D.C. No.

3:05-cv-02125-

JLS-KSC

OPINION

Appeal from the United States District Court

for the Southern District of California

Janis L. Sammartino, District Judge, Presiding

Submitted February 22, 2013*

San Francisco, California

Filed June 16, 2014

Before: Harry Pregerson and Richard A. Paez, Circuit

Judges, and James P. Jones, District Judge.**

Opinion by Judge Pregerson

* The panel unanimously concludes this case is suitable for decision

without oral argument. See Fed. R. App. P. 34(a)(2).

** The Honorable James P. Jones, District Judge for the U.S. District

Court for the Western District of Virginia, sitting by designation.

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2 RUIZ V. AFFINITY LOGISTICS

SUMMARY***

Labor Law

Reversing the district court’s judgment on remand, the

panel held that home delivery drivers who alleged failure to

pay sick leave and other state-law causes of action were

employees, rather than independent contractors, under

California law.

The panel reasoned that the drivers’ employer had the

right to control the details of their work, and that additional,

secondary factors also weighed in favor of a finding that the

drivers were employees. The panel remanded the case to the

district court for further proceedings.

COUNSEL

Daniel A. Osborn, Osborn Law, P.C., New York, New York,

for Plaintiff-Appellant.

James H. Hanson, Scopelitis, Garvin, Light, Hanson & Feary,

P.C., Indianapolis, Indiana, for Defendant-Appellee.

 

*** This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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RUIZ V. AFFINITY LOGISTICS 3

OPINION

PREGERSON, Circuit Judge:

This is the second time this case is before us. PlaintiffAppellant Ruiz and putative class members (collectively,

“drivers”) are California residents who worked for

Defendant-Appellee Affinity Logistics (“Affinity”), a

Georgia corporation. Drivers allege that Affinity wrongfully

classified them as independent contractors; failed to pay them

sick leave, vacation, holiday, and severance wages; and

improperly charged them workers’ compensation insurance

fees. The outcome of these state law causes of action

depends on whether the drivers were employees or

independent contractors of Affinity.

This case first came before us after the district court,

following a three-day bench trial in December 2009, held that

the drivers were independent contractors under Georgia law. 

Ruiz appealed. On February 8, 2012, in Ruiz v. Affinity

Logistics Corporation (“Affinity I”), 667 F.3d 1318, 1325 (9th

Cir. 2012), we concluded that California law, not Georgia

law, applies to the independent contractor versus employee

question in this case, and remanded the matter to the district

court. On remand, the parties agreed that no further evidence

was necessary. The district court ordered the parties to

submit briefs arguing their respective contentions under

California law. Based on these briefs and the December 2009

bench trial record, the district court, on August 27, 2012,

issued a memorandum decision and order concluding that,

under California law, the drivers were independent

contractors.

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4 RUIZ V. AFFINITY LOGISTICS

Ruiz timely appealed the district court’s judgment on

remand. We have jurisdiction under 28 U.S.C. § 1291. For

the reasons set forth below, we reverse.

FACTUAL BACKGROUND

The following facts are undisputed.

A. Affinity’s Hiring of Ruiz

Fernando Ruiz previously worked as a driver for Penske

Logistics Corporation, a furniture delivery company that had

a contract with Sears. His job status was that of an

“employee.” When Sears terminated its contract with Penske

in November 2003, Sears advised the drivers that Affinity

Logistics Corporation (“Affinity”), a company providing

home delivery services for various home furnishing retailers,1

would take over Penske’s contract. Sears advised Ruiz and

other drivers employed by Penske to speak with Danny

Hansen, an Affinity manager, about working for Affinity.

Hansen told Ruiz and the other drivers that if they wished

to be hired by Affinity, they had to become independent

contractors. Specifically, Hansen told the drivers theyneeded

a fictitious business name, a business license, and a

commercial checking account. Affinity then advised the

drivers on how to complete the necessary forms. Affinity

went so far as to complete the forms for Ruiz, leaving only

the spaces for his signature blank. With Affinity’s help, Ruiz

formed R&S Logistics (“R&S”). Ruiz obtained a Federal

1 Affinity describes itself as an “experienced and competent home

delivery contractor [that] desires to perform home delivery services.”

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RUIZ V. AFFINITY LOGISTICS 5

Employer Identification Number and a separate business

banking account for R&S.

Additionally, to work for Affinity, each driver was

required to sign an Independent Truckman’s Agreement

(“ITA”) and Equipment Lease Agreement (“ELA”). The ITA

and the ELA included clauses stating that the parties were

entering into an independent contractor relationship. The

ITA and ELA stated:

Control and Exclusive Use. . . . The parties

intend to create an independent contractor

relationship and not an employer-employee

relationship.

Independent Contractor

(a) Contractor,2in the performance of this

Agreement, will be acting in his own separate

capacity and not as an agent, employee,

partner, joint venture or associate of Affinity. 

It is expressly understood and agreed that

Contractor is an independent contractor of

Affinity in all manners and respects and that

Contractor is not authorized to bind Affinity

to any liability or obligation or to represent

that it has any authority. . . .

The ITA was a one-year contract that automatically renewed

from year to year. The contract could be terminated at any

time by either party without cause upon giving the other party

sixty days notice, or with cause upon breach of contract. The

2 The ITA and ELA repeatedly referred to the drivers as “Contractors.”

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6 RUIZ V. AFFINITY LOGISTICS

ITA set out the drivers’ rate of pay, which, regardless of

experience, was a flat “per stop” rate of $23.00 in 2004. The

ITA also included a provision that a driver “at [Affinity’s]

option, may be transferred to another location then being

served by [Affinity],” and a driver’s failure to comply with a

transfer would be a breach of the ITA.

After Ruiz and the other drivers signed the ITA and ELA,

the drivers received an Affinity Contractor Procedures

Manual (“Procedures Manual”). The Procedures Manual,

prepared by Affinity, outlined procedures drivers were

required to follow regarding loading trucks, delivering goods,

installing goods, interacting with customers, reporting to

Affinity after deliveries, and addressing returns and refused

merchandise, damaged goods, and checking in with Affinity

after deliveries. The Procedures Manual included mandatory

language such as “must,” “will report,” “must contact,”

“required,” “not acceptable,” “100 percent adherence,” and

“exactly as specified.”

Affinity hired Ruiz as a driver in 2003. Ruiz worked for

Affinity from November 2003 to October 2004. Ruiz and the

other drivers were responsible for loading furniture and

appliance deliveries, unloading the deliveries, and installing

the deliveries. Affinity did not require that drivers obtain

special licenses. Nor did Affinity require that drivers have

any specific work experience or training; rather, drivers

simply had to have a driver’s license, sign the ITA and ELA,

and pass a drug test and physical exam.

B. Affinity’s Regulation of Its Drivers

Drivers regularly worked about five to seven days per

week. An Affinity employee would call the drivers each day

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RUIZ V. AFFINITY LOGISTICS 7

to tell them whether or not they were working the following

day. Drivers had a fairly regular rate of pay since they

worked five to seven shifts per week, and every route had

approximately eight deliveries. Drivers had to request time

off three to four weeks in advance, and Affinity had

discretion to deny those requests. Affinity denied requests for

time off when it decided the delivery schedule was too busy.

Affinity encouraged, if not required, drivers to lease

trucks from Affinity. All but one driver in the San Diego area

leased their trucks from Affinity. Affinity automatically

deducted $350 per week from a driver’s paycheck to pay for

the leased truck. Drivers were required to paint their trucks

white, and could not put signs on their trucks. The trucks had

a Sears logo and Affinity’s name and motor carrier number

on the door. Most drivers drove the same truck every day. 

Affinity handled upkeep of trucks and arranged for loaner

trucks when trucks broke down, deducting these costs from

drivers’ pay.

Affinity required drivers to stock their trucks with certain

supplies, as outlined in the Procedures Manual. These

supplies included appliance and furniture totes, plastic

mattress return bags, protective blankets, pads, tie-down

straps, and tools including a level, power drill, and drill bits. 

Affinity required that drivers use a specific type of mobile

telephone. Affinity supplied the phones and deducted

monthly costs for the phones from drivers’ paychecks. 

Affinity also required each driver to have a “helper” or

secondary driver on the truck with them. Helpers had to

submit to a background check and be approved by Affinity.

While working for Affinity, at 6:00 or 6:30 a.m.

everyday, drivers were required to report to the San Diego

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8 RUIZ V. AFFINITY LOGISTICS

Market Delivery Operation (“MDO”) warehouse where

Affinity’s offices were located. When drivers arrived at the

MDO, they had to report to one of the supervisors and pick

up their route manifests, which told them how many

deliveries they had that day and where the deliveries were. 

Drivers then checked to make sure they had all the furniture

and appliances to be delivered.

Next, as outlined in the Procedures Manual, Affinity

required drivers and helpers to attend a fifteen to thirty

minute “stand-up” meeting at 7:15 a.m. The stand-up

meeting was led by an Affinity supervisor. The Affinity

supervisor would review the drivers’ customer satisfaction

survey scores from previous deliveries, discuss problems

encountered in recent deliveries, and discuss any other issues

Affinity thought would be “beneficial to help [drivers] out in

the field.”

Drivers were required to wear uniforms and abide by

certain grooming requirements, as set forth in the “Delivery

Team Apparel and Appearance” section of the Procedures

Manual. The uniform consisted of an “industrial light blue

[shirt] with blue stripe, American flag on sleeve, emblem

with ‘Sears-Authorized Delivery’”; black pants; a belt

without a metal buckle; and “industrial, black leather shoes”

ordered from a particular company, Lehigh Safety Shoes. 

Drivers had to keep their shoes “neat and clean.” Affinity

provided the uniforms, but charged drivers for them by

deducting the costs from drivers’ paychecks. Affinity also

required that tattoos and piercings be covered or removed and

that facial hair be “neatly groomed and properly shaved

surrounding the beard.” Affinity provided shaving kits to

drivers with facial hair that did not meet Affinity’s grooming

requirements.

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RUIZ V. AFFINITY LOGISTICS 9

After each morning stand-up meeting, Affinity required

that Hansen or Jimmy Starnes, another Affinity supervisor,

check the drivers’ trucks to ensure that drivers had the

required tools, that deliveries were loaded with the necessary

padding and properly secured, and that no appliances were

left on the dock. The supervisors also checked that the

drivers were in their required uniform and properly groomed.

Drivers made deliveries according to the route manifests

Affinity provided to them daily. Drivers could not control the

order of deliveries; they were instructed in the Procedures

Manual to maintain “100 percent adherence” to the manifests

created by Affinity. The assignment of routes was based on

scores drivers received from Sears’s customer surveys known

as the QualityMeasurement/Incentive Program. Drivers with

higher scores selected their routes first, while drivers with

lower scores were given the least desirable routes.

Affinity required drivers to call an automated Sears

customer service number after each delivery; this requirement

is listed in the Procedures Manual as “a very important

requirement.” During these calls, drivers would report the

stop number that was just completed, the arrival time, and

departure time. Throughout the day, drivers also had to

contact an Affinity supervisor after every two or three

deliveries. When a driver did not call, Affinity would call the

driver to find out the driver’s location. If a driver was

running late, Affinity would call Sears to inform them that

Affinity had “a driver running late.” Affinity supervisors also

monitored the progress of each driver throughout the day on

a “route monitoring screen,” and would contact a driver if

they noticed he or she was running late or off-course.

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10 RUIZ V. AFFINITY LOGISTICS

Affinity also engaged in “follow-alongs,” whereby an

Affinity supervisor followed a driver for a few stops to ensure

that the driver was wearing the uniform and using proper

delivery techniques. Sometimes the Affinity supervisor

would talk to a customer after a delivery to evaluate the

driver’s performance. Occasionally, for heavier loads, the

Affinity supervisor would also assist the driver in a delivery.

After drivers completed their daily delivery routes, they

returned to the warehouse to park their trucks. At the end of

the day, drivers were required to fill out a form (also known

as a “cover sheet”), and return the route manifest to Affinity. 

Drivers left the trucks and the keys for the trucks at the MDO

warehouse. Affinity admitted that it “strongly discouraged”

drivers from taking the trucks home or otherwise removing

trucks from the warehouse lot overnight or on weekends. 

Moreover, Affinity sometimes used the drivers’ trucks for

other jobs. Drivers were told to leave their keys at the MDO

“just in case they need that truck to run another load with

somebody else.” Affinity did not compensate drivers for the

use of their trucks for these other deliveries.

PROCEDURAL BACKGROUND

Ruiz’s claims—Affinity’s wrongfully classifying the

drivers as independent contractors; Affinity failing to pay

drivers sick leave, vacation, holiday, and severance wages;

and Affinity improperly charging drivers for workers’

compensation insurance3—turn on whether the drivers are

independent contractors or employees of Affinity. After a

3 Ruiz also alleged a claim for overtime pay, but on June 5, 2008, the

district court granted Affinity’s motion for summary judgment as to this

claim. Ruiz does not appeal that ruling.

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RUIZ V. AFFINITY LOGISTICS 11

three-day bench trial in December 2009, the district court

concluded that Georgia law applied to the independent

contractor/employee question and that Ruiz was an

independent contractor under Georgia law. Ruiz appealed the

district court’s ruling.

On February 8, 2012, in Affinity I, we held that California

law, not Georgia law, applies and remanded the matter to the

district court to apply California law. See Affinity I, 667 F.3d

at 1325. On remand, the district court filed a memorandum

decision and order on August 27, 2012, holding that, under

California law, the drivers were independent contractors

rather than employees of Affinity. The district court based its

findings on evidence from the December 2009 bench trial and

arguments made by the parties in their briefs following

remand.4

Ruiz timely appealed the district court’s August 27, 2012

memorandum decision and order.

STANDARD OF REVIEW

The California Supreme Court has held that the standard

of review for the employee versus independent contractor

question under California law may be de novo or clear error,

depending on whether the facts are disputed:

4 At a March 28, 2012 hearing, the district court asked the parties

whether they wanted to introduce additional evidence. According to the

district court, “[t]he parties represented that no further evidence was

necessary, and that the case would not need to be retried.” Neither party

asked to submit additional evidence.

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12 RUIZ V. AFFINITY LOGISTICS

The determination of employee or

independent-contractor status is one of fact if

dependent upon the resolution of disputed

evidence or inferences, and the Division [of

Labor Standards Enforcement]’s decision

must be upheld if substantially supported. If

the evidence is undisputed, the question

becomes one of law, but deference to the

agency’s view is appropriate.

S.G. Borello & Sons, Inc. v. Dep’t of Industrial Relations

(“Borello”), 769 P.2d 399, 403 (Cal. 1989) (citations

omitted).

This case requires us to address the independent

contractor versus employee question under California law. 

Because the parties do not dispute the operative facts, the

standard of review is de novo under Borello. Thus, we

review de novo the district court’s legal conclusion that the

drivers were independent contractors. We review, however,

the district court’s underlying factual findings following a

bench trial for clear error. Fed. R. Civ. P. 52(a)(6); Twentieth

Century Fox Film Corp. v. Entm’t Distrib., 429 F.3d 869, 879

(9th Cir. 2005). A finding is clearly erroneous if we are “left

with the ‘definite and firm conviction that a mistake has been

committed.’” Id.(quotingEasley v. Cromartie, 532 U.S. 234,

242 (2001)); United States v. Hinkson, 585 F.3d 1247,

1260–61 (9th Cir. 2009).

DISCUSSION

“[U]nder California law, once a plaintiff comes forward

with evidence that he provided services for an employer, the

[plaintiff] has established a prima facie case that the

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RUIZ V. AFFINITY LOGISTICS 13

relationship was one of employer/employee.” Narayan v.

EGL, Inc., 616 F.3d 895, 900 (9th Cir. 2010). The burden

then shifts to the employer to “prove, if it can, that the

presumed employee was an independent contractor.” Id.

(citing Cristler v. Express Messenger Sys., Inc., 89 Cal. Rptr.

3d 34, 43–44 (Cal. Ct. App. 2009)). Because Ruiz has shown

that he provided services for Affinity, the burden shifts to

Affinity to demonstrate, if it can, that Ruiz and the other

drivers were independent contractors, not employees.

The California Supreme Court has explained that to

determine whether a worker is an employee or independent

contractor, a court should evaluate “[e]ach service

arrangement . . . on its facts, and the dispositive

circumstances may vary from case to case.” See Borello,

769 P.2d at 407. The Borello court, however, also provided

a number of factors that should guide courts in making that

determination. First, the Borello court stated that “the right

to control work details is the most important or most

significant consideration.” Id. at 404 (emphasis added)

(internal quotation marks omitted); see also Tieberg v.

Unemp’t Appeals Bd., 471 P.2d 975, 977 (Cal. 1970) (holding

that “[t]he principal test of an employment relationship is

whether the person to whom service is rendered has the right

to control the manner and means of accomplishing the result

desired”); Estrada v. FedEx Ground Package Sys., 64 Cal.

Rptr. 3d 327, 335 (Cal. Ct. App. 2007) (“The essence of the

test is the ‘control of details’—that is, whether the principal

has the right to control the manner and means by which the

worker accomplishes the work . . . .”).

In Borello, the California Supreme Court also explained

that additional, “secondary” factors may be relevant in

making that determination:

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14 RUIZ V. AFFINITY LOGISTICS

These include (a) whether the one performing

services is engaged in a distinct occupation or

business; (b) the kind of occupation, with

reference to whether, in the locality, the work

is usually done under the direction of the

principal or by a specialist without

supervision; (c) the skill required in the

particular occupation; (d) whether the

principal or the worker supplies the

instrumentalities, tools, and the place of work

for the person doing the work; (e) the length

of time for which the services are to be

performed; (f) the method of payment,

whether by the time or by the job; (g) whether

or not the work is part of the regular business

of the principal; and (h) whether or not the

parties believe they are creating the

relationship of employer-employee.

Borello, 769 P.2d at 404; see also Tieberg, 471 P.2d at 980

(referring to these factors as “secondary elements”). 

“Generally, . . . [these] individual factors cannot be applied

mechanically as separate tests; they are intertwined and their

weight depends often on particular combinations.” Germann

v. Workers’ Comp. Appeals Bd., 176 Cal. Rptr. 868, 871 (Cal.

Ct. App. 1981). Regarding the final secondary factor, the

California Court of Appeal has noted that the label that

parties place on their employment relationship “is not

dispositive and will be ignored if their actual conduct

establishes a different relationship.” Estrada, 64 Cal. Rptr.

3d at 355.

As we explain below, contrary to the district court’s

conclusion, the totality of the undisputed facts indicate that

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RUIZ V. AFFINITY LOGISTICS 15

the drivers were Affinity’s employees rather than independent

contractors.

A. Primary Factor: Affinity Had the Right to

Control the Details of the Drivers’ Work

In Borello, the California Supreme Court “emphasize[d]

that the [defendant] growers, though purporting to relinquish

supervision of the harvest work itself, retained absolute

overall control of . . . [a]ll meaningful aspects of this business

relationship: price, crop cultivation, fertilization and insect

prevention, payment, [and] right to deal with buyers . . . .”

769 P.2d at 407–08 (third and fourth alterations in original)

(citations omitted) (internal quotation marks omitted). In

these circumstances, the court concluded, the defendant

“retains all necessary control over the harvest portion of its

operations.” Id. at 408; see also JKH Enters., Inc. v. Dep’t of

Indus. Relations, 48 Cal. Rptr. 3d 563, 579 (Cal. Ct. App.

2006) (holding that “[b]y obtaining the clients in need of the

service and providing the workers to conduct it, [delivery

company defendant] retained all necessary control over the

operation as a whole”).

Here, the undisputed facts indicate that Affinity had the

right to control the details of the drivers’ work, and that

Affinity retained all necessary control over the drivers’ work. 

Like defendant FedEx in Estrada, a case where the California

Court of Appeal held that FedEx delivery drivers were

employees, Affinity controlled the drivers’ rates, schedules,

and routes. 64 Cal. Rptr. 3d at 336. Affinity set the drivers’

flat “per stop” rate; the drivers could not negotiate for higher

rates, as independent contractors commonly can. See Borello,

769 P.2d at 409–10. Affinity decided the days drivers

worked, and retained the discretion to deny drivers’ requests

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16 RUIZ V. AFFINITY LOGISTICS

for days off. Affinity determined routes, and instructed

drivers not to deviate from the order of deliveries listed on the

route manifests Affinity created.

Like FedEx in Estrada, Affinity also controlled the

equipment—the trucks, tools, and mobile phones—and the

helpers the drivers used. See Estrada, 64 Cal. Rptr. 3d at 336

(holding that drivers were FedEx’s employees in part because

“[t]he larger items—trucks and scanners—are obtained from

FedEx approved providers, [are] usually financed through

FedEx, and [are] repaid through deductions from the drivers’

weekly checks”).

Affinity controlled the appearance of the drivers by

requiring that drivers wear uniforms and by prohibiting

drivers from wearing earrings, displaying tattoos, and

sporting certain designs of facial hair. The district court

recognized that Affinity regulated the drivers’ uniforms and

appearance, but dismissed these measures of control as

“driven by a need to comply with federal regulations or with

Sears’ requirements.” But, in Estrada, the California Court

of Appeal “summarily reject[ed] FedEx’s suggestion that

[uniform and grooming] constraints such as these are

necessary to ensure the drivers’ compliance with government

regulations.” 64 Cal. Rptr. 3d at 336 n.9; see also Borello,

769 P.2d at 409 n.13 (rejecting defendant’s argument that

because defendant’s customers made defendant adopt the

contract with its migrant workers, the contract should not be

considered as evidence of control). The Estrada court noted

that “FedEx’s control over every exquisite detail of the

drivers’ performance, including the color of their socks and

the style of their hair, supports the . . . conclusion that the

drivers are employees, not independent contractors.” 64 Cal.

Rptr. 3d at 336. This case presents similar undisputed facts

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RUIZ V. AFFINITY LOGISTICS 17

concerning Affinity’s control over “every exquisite detail” of

the drivers’ appearance, including the “color of their socks”

and “the style of their hair.”5

Affinity also closelymonitored and supervised its drivers. 

Each morning, Affinity required drivers to report to the

warehouse, where Affinity had several offices, and attend the

stand-up meeting. This requirement, as the district court

correctlyacknowledged, shows that Affinity exercised “some

degree of control” over the drivers’ start times. See Estrada,

64 Cal. Rptr. 3d at 337 (holding that drivers were employees

in part because “drivers . . . must be at the terminal at regular

times for sorting and packing as well as mandatory meetings,

and they may not leave until the process is completed”). 

Affinity continued to monitor the drivers by inspecting their

appearance and loading of their trucks; conducting “followalongs”; requiring that drivers call their Affinity supervisor

after every two or three stops; monitoring the progress of

each driver on the “route monitoring screen”; and contacting

drivers if Affinity noticed drivers were running late or off

course.

Finally, the provisions of the ITA and the Procedures

Manual demonstrate that Affinity retained the right to control

its drivers. The ITA sets out the drivers’ rate of pay, allows

5 The district court also erred by emphasizing that the rules regarding the

drivers’ appearance were “intended to ensure customer security rather than

control the driver.” (internal quotation marks omitted). In doing so, the

district court misunderstood the Borello test. The district court

incorporated a subjective requirement when it dismissed Affinity’s

appearance requirements as not motivated by Affinity’s intent to control

its drivers. Whether Affinity intended to control the drivers does not

matter under Borello; what matters only is whether Affinity had the right

to control the drivers’ work.

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18 RUIZ V. AFFINITY LOGISTICS

Affinity to terminate drivers without cause with sixty days

notice, and allows Affinity to transfer drivers to other

locations. And, as the district court recognized, the

guidelines contained in the Procedures Manual “were more

than mere ‘suggestions.’” The Procedures Manual outlined

the above-described procedures that Affinity required its

drivers to follow, includingwearing uniforms, loading trucks,

delivering goods, and reporting to Affinity after deliveries.

The district court held that Affinity did not have the right

to control the details of the drivers’ work almost entirely

based on one fact: the drivers could hire helpers and

secondary drivers. But the district court overlooked the fact

that often the reason drivers hired helpers was that they were

required to do so by Affinity. Further, like defendant FedEx

in Estrada, Affinity retained ultimate discretion to approve or

disapprove of those helpers and additional drivers. See id. at

337. While the district court found that approval was largely

based upon neutral factors, such as background checks

required under federal regulations, it is still true that the

drivers did not have an unrestricted right to choose these

persons, which is an “important right[] [that] would normally

inure to a self-employed contractor.” See Borello, 769 P.2d

at 408 n.9 (holding that a contract provision restricting

sharefarmers’ right to choose employees evidenced

defendant’s right to control sharefarmers).

Although Affinity did not require their drivers to obtain

additional drivers, the testimony at trial indicated that the

impetus for doing so came from Affinity whenever it had

additional need for such drivers, rather than any desire by the

drivers to profit from such hiring. Moreover, any additional

drivers were subject to the same degree of control exerted by

Affinity over the drivers generally.

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In any event, the district court’s reliance on this factor as

dispositive in light of the overwhelming evidence of

Affinity’s control over its drivers was error. Like Estrada,

Borello, and JKH Enterprises, Inc., the undisputed facts in

this case show that Affinity retained all necessary control

over the drivers’ work. While “purporting to relinquish”

some control to the drivers by making the drivers form their

own businesses and hire helpers, Affinity “retained absolute

overall control” over the key parts of the business. See

Borello, 48 Cal. 3d at 355–56. This control included much

more than obtaining clients and providing workers, which the

JKH Enterprises, Inc. court found sufficient to establish right

of control. 48 Cal. Rptr. 3d at 579. Affinity retained absolute

control over drivers’ rates, payment, routes, schedules, trucks,

equipment, appearance, decision to hire helpers, choice of

helpers, and the right to deal with customers. In light of

Estrada, Borello, and JHK Enterprises, Inc., the district

court’s contrary conclusion—that Affinity did not exercise

sufficient control over the drivers’ work—was in error.

We also note Affinity’s relationship with its drivers is

very different from the relationship between the parties in

State Compensation Insurance Fund v. Brown, 38 Cal. Rptr.

2d 98 (Cal. Ct. App. 1995), where the California Court of

Appeal found that the truck driver plaintiffs were independent

contractors. There, the truck driver plaintiffs worked for

more than one broker at a time, had “complete control over

their working conditions and the manner in which a load was

transported (including whether or not to hire assistants),” and

were “entirely free to accept or reject an assignment without

reprisal.” Id. at 105. Unlike in State Compensation

Insurance Fund, where the defendant’s “participation is

limited to offering the assignments and paying compensation

upon proof of delivery,” here, as described above, Affinity

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20 RUIZ V. AFFINITY LOGISTICS

regulated many details of the drivers’ work, including

working conditions and the manner in which drivers made

their deliveries. See id.

Thus, the most important factor under the Borello

analysis—right to control—indicates overwhelminglythat the

drivers were Affinity’s employees.

B. Secondary Factors

Moreover, most of the secondary factors outlined in

Borello also point to the conclusion that the drivers were

employees. Borello, 769 P.2d at 404; see also JKH Enters.,

Inc., 48 Cal. Rptr. 3d at 579 n.14.

(1) Distinct occupation or business: Although the district

court recognized that the drivers would not have formed their

own businesses in the absence of Affinity’s requirement that

they do so, the district court stated that “[r]egardless of the

motive for forming their businesses . . . Plaintiffs ultimately

had the ability to expand their businesses by hiring more

employees, operatingmultiple trucks, and makingmanagerial

decisions regarding the employment and performances of the

employees hired.” The district court clearly erred by not

giving enough weight to the fact that Affinity required drivers

to create these businesses as a condition of employment. 

Affinity even helped drivers set up the businesses by filling

out necessary paperwork.

Moreover, in the real world, these businesses were in

name only. The drivers’ only business was with Affinity

because the drivers could not use their trucks for any purpose

other than their work for Affinity. Affinity admitted that it

“strongly discouraged” drivers from removing trucks from

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RUIZ V. AFFINITY LOGISTICS 21

the warehouse lot overnight or on weekends. And, as the

district court found, “Affinity would on occasion allow other

drivers to use their trucks to make deliveries on days the

drivers were not operating their trucks themselves. Plaintiffs

were not compensated for this use.”

(2) Work under principal’s direction or by specialist

without supervision: The district court emphasized that the

drivers’ work included not only driving but also the delivery

and installation of the appliances, and that the delivery and

installation work “requires substantial skill” and was

unsupervised. But in hiring drivers, Affinity did not require

special driving licenses or even any work experience; rather

a driver simply had to have a driver’s license, sign a work

agreement, and pass a physical examination and drug test. 

These facts parallel Estrada, where the court found that

FedEx drivers “need no experience to get the job in the first

place and [the] only required skill is the ability to drive.”

64 Cal. Rptr. 3d at 337. Moreover, as explained above,

Affinity closely supervised the drivers’ work through various

methods. The district court therefore clearly erred when it

concluded that the drivers were specialists without

supervision.

(3) Skill required: As described above, the drivers’ work

did not require substantial skill.

(4) Provision of instrumentalities, tools, and place of

work: As the district court found, “[t]he delivery truck was

the main tool [that] Plaintiffs used to conduct their business.” 

This main tool was provided by Affinity. Affinity advanced

the drivers’ costs of leasing and maintaining their trucks, and

deducted these advances from drivers’ paychecks. Affinity

also required that drivers use a specific type of mobile phone,

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22 RUIZ V. AFFINITY LOGISTICS

provided the drivers with these phones, and deducted the

associated monthly costs from drivers’ paychecks.

The district court recognized these leasing and costadvancing arrangements, but reasoned that under these

arrangements the drivers furnished their own tools because

they ultimately paid for them. We find this conclusion to be

clearly erroneous. Affinity supplied the drivers with the

major tools of the job by encouraging or requiring that the

drivers obtain the tools from them through paid leasing

arrangements. Moreover, the drivers did not own the trucks

or cell phones, but only leased them from Affinity to perform

their work for Affinity.

(5) Method of payment: As the district court found, the

drivers were paid per delivery. The district court recognized

that construing each delivery as an independent “job” would

be unrealistic because jobs are typically longer-term and,

here, drivers made approximately eight deliveries per day. 

The district court nonetheless concluded that the payment

scheme was closer to “by the job” rather than “by the hour”

because “[t]here were no set hours to the day, nor did each

delivery take the same amount of time, even though the

amount paid essentially remained the same.” But the district

court’s findings that drivers made approximately eight

deliveries per day and the amount paid to each driver

“essentially remained the same,” lead to the conclusion that,

although labeled “by the delivery,” the drivers were

essentially paid by a regular rate of pay. See Estrada, 64 Cal.

Rptr. 3d at 335 (finding that the fact that drivers “are paid

weekly, not by the job” weighs in favor of employee status).

(6) Parties’ belief: Ruiz and Affinity understood their

relationship to be an independent contractor arrangement. As

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RUIZ V. AFFINITY LOGISTICS 23

the California Court of Appeal has noted, however, “the

parties’ label is not dispositive and will be ignored if their

actual conduct establishes a different relationship.” Estrada,

64 Cal. Rptr. 3d at 336 (citing Borello, 769 P.2d at 403).

(7) Right to terminate at will: As the district court

concluded, the parties’ mutual termination provision is

consistent with either an employer-employee or independent

contractor relationship.

(8) Work part of principal’s regular business: Affinity,

by its own definition, is an “experienced and competent home

delivery contractor [that] desires to perform home delivery

services.” (emphasis added). As the district court

recognized, Affinity’s drivers perform those very home

delivery services that are the core of Affinity’s regular

business. Without drivers, Affinity could not be in the home

delivery business.

(9) Length of time for performance of services: As the

district court explained, “there was no contemplated end to

the service relationship” when Affinity and the drivers signed

their contracts, and drivers often stayed with Affinity for

years.

Because Affinity had the right to control the details of the

drivers’ work, and because the totality of the secondary

factors weigh in favor of the drivers, under California’s

Borello test, the drivers are employees of Affinity rather than

independent contractors.

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CONCLUSION

The undisputed facts indicate that Affinity had the right

to control the details of the drivers’ work, and the application

of the secondary factors weigh in favor of a finding that the

drivers were employees. We therefore reverse the district

court’s decision that the drivers were independent contractors

and hold that they were Affinity’s employees under

California law. We remand to the district court for further

proceedings consistent with this disposition. Costs shall be

awarded to Ruiz.

REVERSED and REMANDED.

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