Opinion ID: 2678483
Heading Depth: 2
Heading Rank: 1

Heading: Primary Factor: Affinity Had the Right to

Text: 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 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 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 closely monitored 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 correctly acknowledged, 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. 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, including wearing 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. RUIZ V. AFFINITY LOGISTICS 19 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 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 overwhelmingly that the drivers were Affinity’s employees.