Lewis v. Dynasty

• Decision Date: 18 March 2015
• Docket Number: No. 27509.,27509.
• Parties: LeAndra LEWIS, Petitioner, v. L.B. DYNASTY, d/b/a Boom Boom Room Studio 54 and S.C. Uninsured Employers' Fund, Defendants, Of Whom S.C. Uninsured Employers' Fund is, Respondent. Appellate Case No. 2012–213376.
• Court: South Carolina Supreme Court

411 S.C. 637

770 S.E.2d 393

LeAndra LEWIS, Petitioner

v.L.B. DYNASTY, d/b/a Boom Boom Room Studio 54 and S.C. Uninsured Employers' Fund, Defendants

Of Whom S.C. Uninsured Employers' Fund is, Respondent.

Appellate Case No. 2012–213376.

No. 27509.

Supreme Court of South Carolina.

Heard Jan. 14, 2015.

Decided March 18, 2015.

Rehearing Denied April 22, 2015.

Charles B. Burnette, III, of Burnette & Payne, PA, of Rock Hill; John S. Nichols and Blake A. Hewitt, both of Bluestein, Nichols, Thompson & Delgado, LLC, of Columbia, for Petitioner.

Lisa C. Glover, of Columbia, for Respondent.

Opinion

Justice HEARN.

LeAndra Lewis was injured by an errant bullet at Studio 54 Boom Boom Room (the Club) while she was working as an exotic dancer. The question before the Court is whether she is an employee of the Club and thus eligible for workers' compensation. Considering the relationship in toto, we find the Club exercised control over the manner in which she performed her work and therefore conclude she was an employee.

FACTUAL/PROCEDURAL BACKGROUND

Lewis worked as an exotic dancer, performing five to seven days a week. Lewis traveled throughout North and South Carolina to dance at different establishments, and performed at the Club on three separate occasions. Upon arrival at the Club, Lewis presented identification demonstrating she was old enough to perform, reviewed the Club's rule sheet, and paid a tip-out fee. The tip-out fee, which was determined based on when her shift started, was $70.

The types of dances Lewis performed at the Club included V.I.P. dances, table dances, and dances on the stage. Lewis was required to perform V.I.P. dances whenever a patron requested one. The Club set the minimum price of these dances, which were to be performed in a specific area, and Lewis had to give a portion of that payment to the Club. Lewis's rotation on stage was determined by the Club and it chose the music for those performances.

The Club required the performers to follow specific guidelines or risk being fined or immediately discharged. Because this Club was topless only, the dancers were subject to fines for removing their panties. Although the Club did not set times when the dancers were required to work, it did devise a dancing schedule once the women arrived and they were not allowed to leave prior to the end of their shift without paying a fine. Furthermore, if a dancer did not perform on stage during the assigned time, she had to pay a fine. Failure to pay any fine or repeated violations of the rules could result in termination. Additionally, the dancers could be dismissed for fighting or having sex in the Club.

During Lewis's shift at the Club, a fight broke out and Lewis was struck in the abdomen by a stray bullet, which caused severe damage to her internal organs and resulted in the loss of a kidney. She also sustained substantial scarring. Lewis filed a claim for workers' compensation requesting temporary total disability benefits and medical treatment from the date of the accident. The putative employer was not represented at the hearing, but the South Carolina Uninsured Employer's Fund appeared to dispute Lewis's claim, arguing Lewis was an independent contractor and not an employee.

At the hearing, Lewis argued the Club exercised control over the manner in which her work was performed, and she was therefore an employee of the Club. She testified she earned $357 the night she was shot, and made a total of $1,357 at the Club over the course of her shifts. Lewis did not state what her income was at the other establishments where she danced, but stated she made approximately $250 to $350 a night. She had never filed a tax return and produced no documentation indicating where she worked or what her total income was.

The single commissioner found that Lewis was an independent contractor and denied compensation. Additionally, the commissioner stated that had Lewis established she was an employee, her compensation rate would be $75 per week based on Lewis's failure to produce evidence of the income she earned at other establishments. The appellate panel of the Workers' Compensation Commission affirmed, adopting the single commissioner's order.

On appeal, the court of appeals affirmed in a split decision. Lewis v. L.B. Dynasty, Inc., 400 S.C. 129, 732 S.E.2d 662 (Ct.App.2012). The majority found that Lewis was an independent contractor, and thus the court did not have to reach the question of whether the commissioner erred in setting her compensation rate at $75 per week. Id. at 137, 732 S.E.2d at 666. Judge Short dissented, concluding that examining the relationship as a whole, the Club exercised sufficient control to evince an employment relationship. Id. at 139, 732 S.E.2d at 667 (Short, J., dissenting). We granted certiorari.

ISSUE PRESENTED

Did the court of appeals err in finding Lewis was an independent contractor, not an employee of the Club?

LAW/ANALYSIS

Lewis argues the details of her professional relationship preponderate in favor of finding she was an employee of the Club and the court of appeals erred in concluding otherwise. We agree.

We construe workers' compensation law liberally in favor of coverage to further the beneficent purpose of the Workers' Compensation Act; accordingly, only exceptions and restrictions to coverage are strictly construed. James v. Anne's Inc., 390 S.C. 188, 198, 701 S.E.2d 730, 735 (2010). The burden of proving the relationship of employer and employee is upon the claimant, and this proof must be made by the greater weight of the evidence. Marlow v. E.L. Jones & Son, Inc., 248 S.C. 568, 570, 151 S.E.2d 747, 748 (1966). Whether a claimant is an employee or independent contractor is a jurisdictional question and therefore the Court may take its own view of the preponderance of the evidence. Wilkinson ex rel. Wilkinson v. Palmetto State Transp. Co., 382 S.C. 295, 299, 676 S.E.2d 700, 702 (2009). The crux of this determination is the purported employer's right to control the claimant in the performance of his work. Id. In analyzing the nature of a work relationship the Court examines four factors: (1) direct evidence of the right or exercise of control; (2) furnishing of equipment; (3) method of payment; (4) right to fire.

Shatto v. McLeod Reg'l Med. Ctr., 406 S.C. 470, 475–76, 753 S.E.2d 416, 419 (2013). Each factor is considered with equal force and the mere presence of one factor indicating an employment relationship is not dispositive of the inquiry. Id.

At the outset, we agree with Lewis that the majority of the court of appeals allowed its analysis to be influenced by the initial conclusion that Lewis was an “itinerant artistic performer.” Lewis, 400 S.C. at 134, 732 S.E.2d at 664. While we recognize the unique details of the arrangement between the Club and Lewis, we emphasize our inquiry is a balance of factors based on the totality of the circumstances. Attempting to broadly characterize the nature of her profession prior to engagement in the analysis foretells a single result. The question before the Court is a simple, fact-based consideration—did the Club exercise sufficient control over Lewis to create an employee relationship—further commentary on the nature of her profession is unnecessary. We therefore now proceed to the right to control test.

I. RIGHT TO OR EXERCISE OF CONTROL

Turning to the first prong of the test, we find the facts preponderate in favor of an employment relationship. In considering this question, the court of appeals focused on whether the Club dictated how she danced and concluded that because Lewis could choreograph her own routine, the Club did not control her work. We find this a myopic view in light of the facts presented. Certainly, the Club did not specify all the details of her movements, but it is unfaithful to the record to claim it did not control her performance in her capacity as an entertainer. Prior to working her shift, Lewis was required to pay a tip-out fee, undergo a search, and review the Club's rule sheet. The Club could decline her entry if her appearance was undesirable. Once Lewis began her shift, the Club chose the music for all her performances. It also dictated when in the rotation of dancers she must appear on stage. The Club set the minimum for a V.I.P. dance—which she was required to perform if asked—and specified an area for those to take place. Although Lewis technically performed routines of her own direction, the Club specified her degree of nudity—she was required to be topless, but would be fined for removing more. Additionally, she was not permitted to leave her shift early without paying a fine.

We recognize that Lewis had no set schedule, and came when she chose with no other repercussion than the loss of income. Nevertheless, once the Club engaged her for the evening, it exercised significant control over the performance of her work. Accordingly, we find this factor weighs in favor of a finding of an employment relationship.

II. FURNISHING OF EQUIPMENT

We further agree with Lewis that the Club furnished equipment so as to preponderate this factor in favor of her having an employee relationship.

When considering this prong, the court of appeals concluded the Club did “nothing more than allow [Lewis] on the premises” because there was no practical way she could have supplied the poles, stage, furniture, or bar items. Instead, it stated, “From the standpoint of both the [Club] and its customers, Lewis brought her own ‘equipment’ for her work.” Lewis, 400 S.C. at 135, 732 S.E.2d at 665.

Initially, we disagree with the court of appeals that an individual's body can be considered equipment for the purpose of this analysis. See Matter of Hanson, 114 Idaho 131, 754 P.2d 444, 447 (1988) (“The worker's body is not a major item of equipment within the meaning of the third element of the ‘right to control’ test. Major items of equipment include such things as tools, machinery, special clothing, parts, and other similar items necessary for the worker...