Court Opinion

ID: 2971294
Source: CourtListenerOpinion
Date Created: 2015-09-22 16:32:30.641041+00
Date Added: 2024-06-11T11:43:35.144265
License: Public Domain

RECOMMENDED FOR FULL-TEXT PUBLICATION
           Pursuant to Sixth Circuit Rule 206            2       Time Auto Transp. v. NLRB               Nos. 03-1194/1271
   ELECTRONIC CITATION: 2004 FED App. 0236P (6th Cir.)
               File Name: 04a0236p.06                     Before: MARTIN and SUTTON, Circuit Judges; QUIST,
                                                                           District Judge.*
UNITED STATES COURT OF APPEALS                                                  _________________
             FOR THE SIXTH CIRCUIT                                                   COUNSEL
               _________________
                                                         ARGUED: William L. Hooth, COX, HODGMAN &
TIME AUTO                       X                        GIARMARCO, Troy, Michigan, for Petitioner. Richard A.
                                 -                       Cohen, NATIONAL LABOR RELATIONS BOARD,
TRANSPORTATION, INC., AND                                Washington, D.C., for Respondent. James B. Coppess, AFL-
TIME AUTO TRANSPORT , L.S., -                            CIO LEGAL DEPARTMENT, Washington, D.C., for
                                 -   Nos. 03-1194/1271
a single employer,               -                       Amicus Curiae. ON BRIEF: William L. Hooth, COX,
                    Petitioner/ >                        HODGMAN & GIARMARCO, Troy, Michigan, for
                                 ,                       Petitioner. Richard A. Cohen, Aileen A. Armstrong,
            Cross-Respondent, -
                                                         NATIONAL LABOR RELATIONS BOARD, Washington,
                                 -                       D.C., for Respondent. James B. Coppess, AFL-CIO LEGAL
           v.                    -                       DEPARTMENT, Washington, D.C., for Amicus Curiae.
                                 -
NATIONAL LABOR RELATIONS -                                                      _________________
                                 -
BOARD ,
                                 -                                                  OPINION
                   Respondent/ -                                                _________________
              Cross-Petitioner. -
                                 -                         BOYCE F. MARTIN, JR., Circuit Judge. Time Auto, as
                                N                        the name is used in this case, refers to Time Auto
      On Petition for Review and Cross-Application       Transportation, Inc., and Time Auto Transport, L.S., which,
           for Enforcement of an Order of the            the parties agree, together constitute a single employer. Time
             National Labor Relations Board.             Auto employed Randy Hill and Ernest Blake, long-haul truck
           Nos. 7-CA-43641-1; 7-CA-43641-2.              drivers, under separate independent contractor agreements.
                                                         Time Auto concedes that it terminated their contracts based
                 Argued: June 8, 2004                    on Hill’s and Blake’s engagement in activities on behalf of
                                                         Local 299, International Brotherhood of Teamsters, AFL-
          Decided and Filed: July 23, 2004               CIO—which, Time Auto concedes, is a labor organization
                                                         within the meaning of section 152(5) of the National Labor
                                                         Relations Act. 29 U.S.C. § 152(5). Hill and Blake filed

                                                             *
                                                              The Honorable Gordon J. Quist, United States District Judge for the
                                                         W estern District of Michigan, sitting by designation.

                           1
Nos. 03-1194/1271            Time Auto Transp. v. NLRB          3    4      Time Auto Transp. v. NLRB             Nos. 03-1194/1271

charges with the National Labor Relations Board challenging          payments, all of which they stood to lose if they did not
their termination pursuant to provisions of the Act. An              perform up to company expectations.” Also, the Board found
administrative law judge found that because Hill and Blake           that Time Auto expected drivers to meet assigned delivery
were “employees” under the definition provided in the Act,           dates and times even if doing so required violating federal
29 U.S.C. § 152(3), then Time Auto’s treatment and                   restrictions. Blake testified that every driver understood that
termination of Hill and Blake were in violation of sections          if he did not meet these demands then the dispatchers would
158(a)(1) and (3) of the Act. A Board majority affirmed that         “starve [the driver] out”—i.e., not give any assignments —
judgment.                                                            and Hill testified that Time Auto instructed him to “keep [his]
                                                                     logs”—i.e., fabricate drive time in order to comply with
   On appeal, the parties stipulate that if this Court agrees that   federal regulations. Their assertions were supported by the
Hill and Blake are employees of Time Auto, and not                   testimonial evidence of Cynthia Morefield, a former office
independent contractors, then Time Auto is in violation of the       manager and controller for Time Auto. The administrative
Act. Thus, the sole issue before this Court is whether Hill and      law judge determined that the statements of Hill, Blake, and
Blake were “employees” as defined in section 152(3), or              Morefield were credible.
whether they were independent contractors within the
meaning of the 1947 amendment that provides that “[t]he                 In affirming the decision of the administrative law judge,
term ‘employee’ . . . shall not include . . . any individual         the Board conceded that as to “. . . the structure of Hill’s and
having the status of an independent contractor. . . .”               Blake’s work relationship with [Time Auto], the balance tips
                                                                     in favor of finding independent contractor status[,]” but that
                                I                                    “by demanding over-limit drive time and backing that
                                                                     demand with a threat of job loss, [Time Auto] sought to
   Hill and Blake operated equipment, which they leased from         exercise a degree of control over the manner of work
Time Auto pursuant to formal lease agreements, on a full-            performance that [the Board] finds inconsistent with
time basis. When they entered into the agreements to lease           independent contractor status.” In the single dissent, a Board
the equipment, both drivers were required to make down               member stated that “numerous factors tend to support a
payments, as well as substantial monthly payments, which             finding of independent contractor status,” and that
they would forfeit if they were terminated for inadequate
performance. Hill and Blake had no exclusive territory or                [Time Auto] . . . has done virtually everything possible
customers, and instead serviced the requests of Time Auto                to structure the relationship with the lease drivers in such
according to a Time Auto dispatcher’s directions. If the                 a way as to make clear to all that they are independent
drivers received no direction, then they were ordered to wait,           contractors rather than employees. Indeed, it is difficult
rather than work independently for individual profit. The                to see how, if Hill and Blake are not independent
equipment-lease and independent contractor agreements were               contractors, there could be any independent contractors
terminable at will on five days notice without cause.                    among the drivers in the long-haul trucking industry.
  According to the testimony of Hill and Blake, and as found         Time Auto makes these same arguments on appeal, stating
by the Board, this “power of termination . . . was amplified by      that the relationships between Time Auto and Hill and Blake
the fact that the drivers began with substantial $10,000 down        were structured to be independent contractor relationships,
payments on their equipment, and made substantial monthly            “as reflected in the Independent Contractor Agreements and
Nos. 03-1194/1271           Time Auto Transp. v. NLRB          5    6    Time Auto Transp. v. NLRB            Nos. 03-1194/1271

Equipment Lease Agreements entered into by Hill and                    Our review of the record as a whole leads us to conclude
Blake.”                                                             that substantial evidence supports the Board’s determination
                                                                    that Time Auto asserted such control over Hill and Blake as
  Time Auto also asserts that Hill and Blake both operated          to make them its employees. While we have considered “all
through their own corporations (respectively, Four Hill’s           incidents of the work relationship,” id., we are particularly
Auto Transportation, Inc., and Dimarlou Enterprise), that they      persuaded by the at-will nature of the contracts, the
could hire drivers to work for them, that they were paid on a       substantial down-payments made by Hill and
percentage basis, and that they were responsible for all of the     Blake—recovery of which depends on employment by Time
costs of operating, maintaining, and repairing their tractors       Auto—and Time Auto’s instructions to disregard federal
and trailers. Time Auto made payments to these corporations         regulations. These factors constitute substantial evidence
rather than to Hill and Blake as individuals. Time Auto             supporting the Board’s determination that Hill and Blake are
argues that “[t]o the extent that [it] exercised any control over   employees, not independent contractors. See Aetna Freight
Hill and Blake, such activity was directed solely at achieving      Lines, 520 F.2d at 930 (holding that “severe restrictions” on
the ends of performance and ensuring customer                       leasing, the use of lease terminations as discipline, the
satisfaction. . . . In sum, Hill and Blake operated as the small,   “carefully prescribed” time restrictions on deliveries, and the
independent businesses they were.”                                  “‘how to do it’ directions covering other aspects of the
                                                                    driving operation” indicated heightened control over workers,
                               II                                   thereby making them employees).
  We sustain the findings and conclusions of the Board if              We recognize that other factors may arguably suggest a
they are “supported by substantial evidence on the record           finding of independent-contractor status—e.g., Hill and Blake
viewed as a whole.” Universal Camera Corp. v. NLRB, 340             paid for their own expenses, received no company benefits,
U.S. 474, 493 (1951). We also review the “Board’s                   and could hire drivers to work for them. However, these
application of the law to particular facts under the substantial    factors are insufficient to undermine our conclusion that
evidence standard.” Turnbull Cone Baking Co. v. NLRB, 778           substantial evidence supports the Board’s decision.
F.2d 292, 295 (6th Cir. 1985), cert. denied, 476 U.S. 1159
(1986). Substantial evidence is “such relevant evidence as a                                     III
reasonable mind might accept as adequate to support a
conclusion.” Consol. Edison Co. v. NLRB, 305 U.S. 197, 229           For the foregoing reasons, we affirm the judgment of the
(1938). In analyzing whether Hill and Blake are employees           Board.
or independent contractors, we apply the “right to control
test,” NLRB v. United Ins. Co. of Am., 390 U.S. 254, 256
(1968); Aetna Freight Lines, Inc. v. NLRB, 520 F.2d 928, 930
(6th Cir. 1975), which requires us to consider the total factual
context of employment. Id. As the Supreme Court has made
plain, the determination of “employee” or “independent
contractor” status requires an evaluation of “all incidents of
the work relationship,” with “no one factor being decisive.”
United Ins., 390 U.S. at 258.