EMPLOYER STATUS DETERMINATION

L.P.M. Holding Company, Inc.

APR 0 1 2004

This is the determination of the Railroad Retirement Board concerning the status of

L.P.M. Holding Company, Inc. (LPM), doing business as Epicurean Feast, as an 

employer under the Railroad Retirement Act (RRAX45 U.S.C. § 231 et seq.) and the

Railroad Unemployment Insurance Act (RUIAX45 U.S.C. § 351 et seq.).

On October 5, 2001, LPM entered into a contract with Northern NewT England Passenger

Rail Authority7 to provide food service on The Downeaster. Northern New England was

held by the Board not to be an employer under the Acts (B.C.D. No. 03-27). It wras

established as a state agency by the State of Maine for the purpose of promoting

passenger rail service. On December 2,1996, it entered into an agreement with Amtrak

for provision by Amtrak of passenger service between Portland and Boston. That

service, known as “The Downeaster,” began on December 15, 2001.

Section 1(a)(1) ofthe Railroad Retirement Act (45 U.S.C. § 231(a)(1)), insofar as relevant

here, defines a covered employer as:

(i) any carrier by railroad subject to the jurisdiction ofthe Surface

Transportation Board under Part A ofsubtitle IV oftitle 49, United States

Code;

(ii) any company winch is directly or indirectly owned or controlled

by, or under common control with, one or more employers as defined in

paragraph (i) ofthis subdivision, and which operates any equipment or

facility or performs any service (except trucking service, casual service, 

and the casual operation of equipment or facilities) in connection with the

transportation of passengers or property by railroad * * *.

Sections i(a) and i(b) ofthe Railroad Unemployment Insurance Act (45 U.S.C. §§ 351(a)

and (b)) contain substantially similar definitions, as does section 3231 ofthe Railroad

Retirement Tax Act (26 U.S.C. § 3231).

LPM clearly is not a carrier by rail. Further, the available evidence indicates that it is

not owned by a railroad and is not under common ownership with any rail carrier nor is

it controlled by officers or directors who control a railroad. Therefore, LPM is not a

covered employer under the Acts.

This conclusion leaves open, however, the question as to whether the persons who 

perform work for LPM under its arrangement with Northern New England should be

considered to be employees of Amtrak rather than of LPM. Section i(b) ofthe Railroad

Retirement Act and section i(d) ofthe Railroad Unemployment Insurance Act both

define a covered employee as an individual in the service of an employer for

compensation. Section 1(d)(1) ofthe RRA further defines an individual as "in the

service of an employer" when:
L.P.M. Holding Company, Inc.

(i)(A) he is subject to the continuing authority ofthe employer to

supervise and direct the manner of rendition of his service, or (B) he is

rendering professional or technical services and is integrated into the staff

ofthe employer, or (C) he is rendering, on the property used in the

employer's operations, personal services the rendition of which is

integrated into the employer's operations; and

(ii) he renders such service for compensation * * *.

Section i(e) of the RUIA contains a definition ofservice substantially identical to the

above, as do sections 3231(b) and 3231(d) ofthe RRTA (26 U.S.C. §§ 3231(b) and (d)).

The focus of the test under paragraph (A) is whether the individual performing the

service is subject to the control ofthe service-recipient not only with respect to the

outcome of his work but also with respect to the way he performs such work.

The contract between LPM and Northern New England shows that Amtrak is not 

involved in the supervision of work by LPM’s employees. Accordingly, the control test

in paragraph (A) is not met. The tests set forth under paragraphs (B) and (C) go beyond

the test contained in paragraph (A) and would hold an individual to be a covered 

employee if he is integrated into the railroad's operations even though the control test in

paragraph (A) is not met. However, under an Eighth Circuit decision consistently

followed by the Board, these tests do not apply to employees ofindependent contractors

performing services for a railroad where such contractors are engaged in an

independent trade or business. See Kelm v. Chicago. St. Paul. Minneapolis and Omaha

Railway Company. 206 F. 2d 831 (8th Cir. 1953). LPM is the thirtieth largest food

service company in the country, and it manages dining rooms, cafeteria, and catered

events for corporations throughout the New England area. It has been in business for 

over 50 years. Accordingly, LPM is clearly an independent enterprise as that term is

used in Kelm.

Therefore, a majority of the Board1 concludes that services provided by employees of

LPM to Amtrak under the terms of LPM’s contract with Northern New England are not

covered under the Railroad Retirement; 1 " -1 1TT 1 1 T Vets.

The Labor Member abstained.