Opinion ID: 198264
Heading Depth: 3
Heading Rank: 2

Heading: Corporate Plaintiffs' Employer Status

Text: 22 Throughout the course of this litigation, plaintiffs maintained that the temporary workers were in fact independent contractors, not employees, and that the FLSA's overtime compensation provisions therefore are inapplicable. Using a six-factor test commonly used to distinguish between independent contractors and employees in the context of the FLSA, see, e.g., Martin v. Selker Bros., Inc., 949 F.2d 1286, 1293 (3d Cir.1991), the Board rejected plaintiffs' contention and concluded that the workers were employees within the meaning of the Act. At oral argument, plaintiffs finally conceded this point, but continued to insist that the workers were the employees only of the client companies for whom they performed labor, rather than the employees of plaintiffs. The Board had also rejected this contention. We affirm the Board's conclusion that the corporate plaintiffs were employers of the temporary workers, notwithstanding the alleged simultaneous employer status of the client companies. 23 The Act defines an employee as any individual employed by an employer. 29 U.S.C. § 203(e)(1). An employer is defined as any person acting directly or indirectly in the interest of an employer in relation to an employee.... Id. § 203(d). The Act further states that the term employ includes to suffer or permit to work. Id. § 203(g). In determining the scope of the Act, courts have consistently recognized that a broader or more comprehensive coverage of employees within the stated categories would be difficult to frame. United States v. Rosenwasser, 323 U.S. 360, 362, 65 S.Ct. 295, 89 L.Ed. 301 (1945). These definitions ... [are] comprehensive enough to require [their] application to many persons and working relationships, which prior to this Act, were not deemed to fall within an employer-employee category. Rutherford Food Corp. v. McComb, 331 U.S. 722, 729, 67 S.Ct. 1473 (1947) (quoting Walling v. Portland Terminal Co., 330 U.S. 148, 150, 67 S.Ct. 639, 91 L.Ed. 809). Moreover, the remedial purposes of the FLSA require courts to define  'employer' more broadly than the term would be interpreted in traditional common law applications. Dole v. Elliott Travel & Tours, Inc., 942 F.2d 962, 965 (6th Cir.1991). The FLSA contemplates several simultaneous employers, each responsible for compliance with the Act. See Falk v. Brennan, 414 U.S. 190, 195, 94 S.Ct. 427, 38 L.Ed.2d 406 (1973); Bonnette v. California Health & Welfare Agency, 704 F.2d 1465, 1469-70 (9th Cir.1983); see also 29 C.F.R. § 791.2(a). 24 Accordingly, to determine whether an employment relationship exists for the purposes of federal welfare legislation, courts look not to the common law conceptions of that relationship, but rather to the economic reality of the totality of the circumstances bearing on whether the putative employee is economically dependent on the alleged employer. See Aimable v. Long and Scott Farms, 20 F.3d 434, 439 (11th Cir.1994). To that end, we find that the factors used in Bonnette, 704 F.2d 1465, provide a useful framework. 9 In Bonnette, the court evaluated whether chore workers who provided domestic in-home services were employed jointly by the individual recipients for whom they performed services and the state agency administering the program. In concluding that the chore workers were jointly employed, the court looked in particular to four factors: whether the alleged employer (1) had the power to hire and fire the employees; (2) supervised and controlled employee work schedules or conditions of employment; (3) determined the rate and method of payment; and (4) maintained employment records. See id. at 1470. 25 The first two Bonnette factors address the extent of a putative employer's control over the nature and structure of the working relationship. It is undisputed that Baystate was solely responsible for hiring the temporary workers, and that it had the power to refuse to send a worker back to a job site where he or she had performed unsatisfactorily. The record also establishes that Baystate supervised and controlled employee work schedules and conditions of employment: dictated the times at which workers were to report to the agencies' offices; screened workers for minimum qualifications; decided which workers would be assigned to particular job sites; sometimes transported workers to job sites at client companies; instructed workers about appropriate dress and work habits; and forbade workers from contacting directly a client company about potential job opportunities. 26 Despite these indicia of Baystate's considerable control over the nature and structure of the relationship with the temporary workers, plaintiffs emphasize that Baystate did not exercise any direct, on-the-job supervision of the workers at the client companies. In these circumstances, we do not perceive the absence of direct supervisory oversight of the workers' day-to-day activities to be dispositive. First, although the client companies were solely responsible for on-site supervision of the workers, Baystate exercised indirect supervisory oversight of the workers through its communications with client companies regarding unsatisfactory performance, occasionally taking workers off the site in the middle of a job. Thus, Baystate retained the authority to intervene if problems arose with a worker's job performance. See Bonnette, 704 F.2d at 1470; see also Superior Care, 840 F.2d at 1060 (An employer does not need to look over his workers' shoulders every day in order to exercise control.). In any event, it is the totality of the circumstances, and not any one factor, which determines whether a worker is the employee of a particular alleged employer. For these reasons, we conclude that the absence of direct, on-site supervision does not preclude a determination that plaintiffs are the employers of the temporary workers within the broad definition of the FLSA. 27 Turning next to Bonnette 's final two criteria, which address the extent of a putative employer's control over the economic aspects of the working relationship, we note that Baystate exercised unfettered discretion in determining the rate and method of payment. It determined the workers' hourly wage rates (usually minimum wage), required workers to complete and submit time sheets prepared by Baystate and signed by the client companies, and issued the workers' paychecks. Moreover, it is undisputed that Baystate maintained the workers' employment records, and in fact represented to clients in its promotional materials that it would handle all the burdensome paperwork, bookkeeping, record keeping, payroll costs, and government reporting. In these circumstances, we find no error in the Board's conclusion that the corporate plaintiffs were the temporary workers' employers, within the meaning of the FLSA. 28