City Cab Co. of Orlando, Inc. v. N.L.R.B.

• Decision Date: 09 September 1980
• Docket Number: No. 79-1544,79-1544
• Citation: 628 F.2d 261,202 U.S.App.D.C. 261
• Parties: 104 L.R.R.M. (BNA) 3053, 202 U.S.App.D.C. 261, 89 Lab.Cas. P 12,164 CITY CAB COMPANY OF ORLANDO, INC., et al., Petitioners, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 261

628 F.2d 261

104 L.R.R.M. (BNA) 3053, 202 U.S.App.D.C. 261,

89 Lab.Cas. P 12,164

CITY CAB COMPANY OF ORLANDO, INC., et al., Petitioners, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 79-1544.

United States Court of Appeals,

District of Columbia Circuit.

Argued May 6, 1980.

Decided July 30, 1980.

Rehearing Denied Sept. 9, 1980.

Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board.

Harrison C. Thompson, Jr., Tampa, Fla., with whom Robert E. Haythorne, Chicago, Ill., and Thomas M. Gonzalez, Tampa, Fla., were on the brief, for petitioners. A. Byrne Litschgi, Tampa, Fla., also entered an appearance for petitioners.

Richard A. Cohen, Atty., N.L.R.B. of the bar of the Supreme Court of New York pro hac vice by special leave of Court, Washington, D. C., with whom Elliott Moore, Deputy Associate Gen. Counsel, N.L.R.B., Washington, D. C., was on the brief, for respondent.

Before McGOWAN and ROBINSON, Circuit Judges, and OBERDORFER ^*, United States District Judge for the District of Columbia.

Opinion for the Court filed by Circuit Judge McGOWAN.

McGOWAN, Circuit Judge:

The National Labor Relations Board (the Board) has ordered petitioner City Cab Co. of Orlando, Florida, to bargain collectively with its taxi drivers. ¹ The company seeks review of that order, contending that the drivers are not employees, but independent contractors, and therefore not covered by the National Labor Relations Act. ² Petitioner does not attack the Board's factual findings. ³ Instead, the company asserts that this case is indistinguishable from this court's recent decision in Local 777, Seafarers International Union v. NLRB, ⁴ which found certain taxi drivers to be independent contractors. The Board, however, identified several factual differences between this case and Local 777, and concluded that petitioner's drivers were employees within the meaning of the Act.

Cases of this sort often turn on fine factual distinctions; as the Supreme Court has said, "(T)here is no shorthand formula or magic phrase that can be applied to find the answer, but all of the incidents of the relationship must be weighed with no one factor being decisive." NLRB v. United Insurance Co., 390 U.S. 254, 258, 88 S.Ct. 988, 991, 19 L.Ed.2d 1083 (1968). The Board in this case did weigh the relevant factors, and it found them indicative of employee status. We cannot say the Board erred in this determination, so we affirm.

I

The facts of this case are set forth here as found by the Board. See note 3 supra. Petitioner is a taxicab company serving Orlando and vicinity, including the Disney World amusement park and, under an exclusive contract, the Orlando airport. City licenses and permits allow the company to operate 115 of the 127 cabs authorized for the city.

The company drivers formerly worked on commission, retaining approximately 50% of all fares collected, and turning over the remainder to the company. On July 16, 1976, with the goal of making its drivers "independent contractors," the company put into effect a different system. Under the new system, all drivers leased cabs from the company under a schedule of rates incorporated into a contract signed by each driver.

The company changed the rate schedule five times between July 16, 1976, and October 1, 1976. On the latter date, the company presented an entirely new contract to the drivers. This second contract was styled as a "sale of services" by the company to the driver rather than a cab lease. Under the second contract, the company agreed to provide a cab and certain ancillary services to drivers in exchange for a fee. Changing from a lease to a sale-of-services plan was desirable, according to the company, because sales of services, unlike leases, are not subject to the Florida sales tax.

On November 1, 1976, the company presented a third contract to the drivers. This contract was similar to the second, although the rate schedule was again modified.

During November, 1976, the company informed the drivers that it wanted some drivers again to become "commission" drivers, rather than "contract" drivers. By November 22, 1976, a number of drivers had done so.

The company presented a fourth contract to the "contract" drivers on January 10, 1977. This contract once again changed the rate schedule. This was the contract in effect at the time of the hearing before a Board Hearing Examiner. It provides that the company furnish a cab, ⁵ liability insurance, maintenance and wrecker service, training, and dispatch service. "Contract" drivers, in return, pay the company a daily fee based on one of three rate plans. Under rate I, the driver pays a fee for use of the cab for up to ten hours, plus a mileage charge. Rate II requires payment of a mileage charge only. Rate III, which is available only after 6 p. m. each day, requires payment of a flat rate with no reference to mileage. ⁶ A driver chooses a rate plan upon signing out with a cab, ⁷ and pays when he turns in the cab at the end of his stint.

The contract recites that the parties do not intend to create an employment relationship, and that drivers are to work without interference or control by the company. The term of the agreement is 12 months, but a driver's failure to purchase services for five consecutive days, or the company's refusal to deliver services, results in cancellation of the agreement. Thus, it is in effect terminable at will by either party.

The contract imposes a standard of conduct on drivers. One element is a dress code. Drivers must keep themselves "neat and clean." In practice, the employer interprets this term to require each driver to be clean shaven, and to wear a shirt with a collar. Drivers may not wear jeans, shorts, or tennis shoes. The only hat that can be worn is a company-designated "cab driver's hat." A driver who does not conform to this dress code is not given a cab.

Drivers must also adhere to the provisions of the concession agreement that gives the company the exclusive right to serve the Orlando airport. Pursuant to that agreement, drivers must keep a record of their trips so that the company can calculate the per-trip fee it owes the airport. The airport concession agreement also requires drivers to accept all passengers desiring service, whatever their destination. To meet this obligation, the company publishes rules governing the operation of cabs at the airport. Under these rules, company supervisors, called "starters," assign cabs to the queues in front of the various airline gates, and ultimately assign passengers to the cabs. A starter may skip over the cab next in line if a different vehicle, usually a van, is more appropriate for a particular passenger group. "Contract" drivers may refuse to take the passenger assigned them by the starter, but, if they do, they must leave the airport or return to the end of the line.

Drivers not serving the airport usually receive their fares by consulting with the dispatcher by radio. Upon receiving a call from a prospective customer, the dispatcher refers to a large board that contains magnets indicating the location of each driver in the fleet. The closest driver generally is assigned to pick up the new fare. "Contract" drivers theoretically may refuse to accept an assignment from the dispatcher, but several that have done so have been reprimanded by company officials. Some drivers also testified that they fear that the dispatcher will pass over them in the future if they decline assignments.

Contract drivers are free to prospect for fares independently, but most taxi customers in Orlando call the dispatcher for service. Thus, only about 10% of drivers' income is earned by such prospecting. The rest results from airport service and radio dispatches.

II

To decide whether these facts point in the direction of employee or independent contractor status, we apply general principles of agency law:

The extent to which drivers . . . must follow "special instructions" governing the manner in which they perform their job is relevant to whether those drivers are independent contractors or employees. . . . (T)he critical question is the company's right to control the manner in which the driver does his job.

Local 777, Seafarers International Union v. NLRB, 603 F.2d 862, 870-71 n. 22 (D.C.Cir.,1978). Under that test,

an employer-employee relationship exists when the employer reserves not only the right to control the result to be achieved, but also the means to be used in attaining the result. On the other hand, where the employer has reserved only the right to control the ends to be achieved, an independent contractor relationship exists.

Id. at 872-73 n. 24, quoting Twin City Freight, Inc., 221 N.L.R.B. 1219, 1220 (1975).

In making this inquiry, we are greatly aided by the recent opinion of this court in Local 777, Seafarers International Union v. NLRB, 603 F.2d 862 (D.C.Cir.,1978), and an accompanying opinion denying rehearing, 603 F.2d 891 (D.C.Cir.,1979), which found that certain Chicago taxi drivers were not employees, but independent contractors. Petitioner asserts that the facts in Local 777 are indistinguishable from those in the case before us. If so, our task truly will be a simple one, because we are bound by the decision of another panel of this court. However, an examination of the work relationship in Local 777 confirms the Board's conclusion that it differs substantially from that in the case before us.

First, and perhaps most important, the Orlando company requires its drivers to maintain a trip sheet that chronicles each driver's movements and fares. Local 777 taught that "(t)he absence of a trip sheet or other means of holding drivers accountable for their income is a significant indication of the lack of company control over the drivers." 603 F.2d at 876 (emphasis added). By that reasoning, the presence of a trip sheet requirement militates strongly in favor of employer control....