Strikeforce Staffing LLC v. Comm'r of Labor (In re Cruz)
| Decision Date | 28 April 2022 |
| Docket Number | 533409 |
| Parties | In the MATTER OF the Claim of Nelson Ruiz CRUZ, Respondent. Strikeforce Staffing LLC, Appellant. v. Commissioner of Labor, Respondent. |
| Court | New York Supreme Court — Appellate Division |
Law Office of Gregory Smith, New York City (Gregory G. Smith of counsel), for appellant.
Carolyn B. George, Albany, for Nelson Ruiz Cruz, respondent.
Letitia James, New York City (Marjorie S. Leff of counsel), for Commissioner of Labor, respondent.
Before: Lynch, J.P., Clark, Reynolds Fitzgerald, Colangelo and McShan, JJ.
Clark, J. Appeal from a decision of the Unemployment Insurance Appeal Board, filed October 15, 2020, which ruled that Strikeforce Staffing LLC was liable for additional unemployment insurance contributions on remuneration paid to claimant and others similarly situated.
Strikeforce Staffing LLC is a staffing agency that recruits and refers job seekers to its clients – various businesses in need of workers. Claimant completed an online application seeking work in line production, and Strikeforce recruited him for an interview with a bakery in need of a pallet packer. Claimant was hired by the bakery, and he worked there from October 2017 through July 2018, when the bakery discharged him after a problem arose. Claimant thereafter applied for unemployment insurance benefits, and the Unemployment Insurance Appeal Board determined that claimant was an employee of Strikeforce and that Strikeforce was liable for unemployment insurance contributions on remuneration paid to claimant and those similarly situated. Strikeforce appeals, and we reverse.
In making a determination regarding employment status, "all aspects of the arrangement" must be considered, "[b]ut the touchstone of the analysis is whether the [putative] employer exercised control over the results produced by the worker or the means used to achieve the results" ( Matter of Vega [Postmates Inc.-Commissioner of Labor] , 35 N.Y.3d 131, 137, 125 N.Y.S.3d 640, 149 N.E.3d 401 [2020] [internal quotation marks, brackets and citations omitted]). "[I]f supported by substantial evidence on the record as a whole," such a determination "is beyond further judicial review even though there is evidence in the record that would have supported a contrary conclusion" ( id. at 136, 125 N.Y.S.3d 640, 149 N.E.3d 401 [internal quotation marks and citation omitted]), but "[i]ncidental control over the results produced — without further evidence of control over the means employed to achieve the results — will not constitute substantial evidence of an employer-employee relationship" ( Matter of Empire State Towing & Recovery Assn., Inc. [Commissioner of Labor], 15 N.Y.3d 433, 437, 912 N.Y.S.2d 551, 938 N.E.2d 984 [2010] [internal quotation marks and citation omitted]; see Matter of Desravines [Logic Corp.–Commissioner of Labor], 146 A.D.3d 1205, 1206, 44 N.Y.S.3d 811 [2017] ; Matter of Richins [Quick Change Artistry, LLC–Commissioner of Labor], 107 A.D.3d 1342, 1344, 968 N.Y.S.2d 680 [2013] ).
The record reflects that Strikeforce recruited job seekers for its clients, businesses in need of workers, by placing advertisements on various websites. For example, claimant completed an application on Indeed.com for a line production position at a bakery. Strikeforce would first screen a job seeker's application to see if he or she potentially met a client's needs and, if so, send the individual for an interview with the client. The client would make a hiring decision and, according to the testimony of the owner and operator of Strikeforce, Strikeforce clients did not hire about 30% to 40% of the applicants referred to them. If hired, the client, not Strikeforce, would provide the worker with his or her rate of pay, which the worker was free to negotiate with the client,1 and the worker's schedule.
When workers such as claimant were hired by a client, they were sent a congratulatory letter from Strikeforce highlighting certain contractual obligations. This letter noted, among other things, that the workers must advise both the client and Strikeforce if they could not report to work. However, the contract itself, provided by Strikeforce and signed by claimant, required only that a worker contact the client regarding absences, and the owner/operator of Strikeforce offered uncontradicted testimony that this was in fact Strikeforce's expectation whereas the letter reflected a "best practice[ ]" (see Matter of Jhaveri [Stacy Blackman Consulting, Inc. -Commissioner of Labor], 127 A.D.3d 1391, 1392, 5 N.Y.S.3d 621 [2015] ). The letter also stated that a worker should contact Strikeforce with questions pertaining to payroll or the contract itself,2 "not [questions] concerning the work," as explained by the owner/operator. Strikeforce did not provide the workers hired by its clients with...
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