Yellow Taxi Co. of Minneapolis v. N.L.R.B., 80-1481
| Decision Date | 22 December 1983 |
| Docket Number | No. 80-1481,80-1481 |
| Parties | 114 L.R.R.M. (BNA) 3060, 232 U.S.App.D.C. 131, 99 Lab.Cas. P 10,565 YELLOW TAXI COMPANY OF MINNEAPOLIS, d/b/a Suburban Yellow Taxi Company, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Petition for Review of an Order of the National Labor Relations Board and Cross-Application for Enforcement.
Robert E. Haythorne, Chicago, Ill., for petitioner.
Allison W. Brown, Jr., Washington, D.C., with whom Elliott Moore, Deputy Associate General Counsel, Washington, D.C., was on the brief, for respondent.
Before WRIGHT and BORK, Circuit Judges, and MacKINNON, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge MacKINNON.
We are again called upon to review a decision of the National Labor Relations Board (the Board), holding that cab drivers who drive taxis under a lease which expressly provides that they are independent contractors are nevertheless employees within the meaning of the National Labor Relations Act (the Act). 1 Like the Administrative Law Judge, 2 we find the facts in this case to be "not materially distinguishable" from those in our earlier decision in Local 777, Democratic Union Organizing Committee, Seafarers International Union of North America v. NLRB (Seafarers), 603 F.2d 862 (D.C.Cir.1978). That decision, which held the drivers to be independent contractors, controls the disposition of this case and, accordingly, we reverse the Board's decision.
Minneapolis Yellow Taxi Company, Inc. (Minneapolis Yellow) conducts a taxicab business in the City of Minneapolis and many of its suburbs through five operating divisions. The division that is the subject of this case is Suburban Yellow Taxi Company (Suburban), which does business in several southern and southwestern suburbs of Minneapolis that are adjacent to or close by the Minneapolis-St. Paul Metropolitan International Airport (Airport). The legislative act which created the Airport gives it the same status as a municipal corporation. 3 The principal suburbs served by Suburban are Bloomington (81,831), Richfield (37,851) and Edina (46,073), which according to the 1980 census have a combined population of 165,755. Other adjacent suburbs bring the population in the area serviced by Suburban to over 200,000. The Airport, Bloomington and Richfield have ordinances regulating taxicabs. Tr. 105, 128, 133, 181. 4 Taxicabs operate in other adjacent suburban communities without licenses, Tr. 31-32 (JA 93-94), but all the communities establish the same meter rates. Tr. 410-11.
As the NLRB brief states:
Prior to March 1, 1977, all drivers at both [Minneapolis] Yellow Taxi and [Suburban] were "commission drivers" who were paid on the basis of a percentage of their gross receipts. The commission drivers were covered by [a] collective bargaining agreement [with the Brotherhood of Railway, Airline and Steamship Clerks, Freight Handlers, Express and Station Employees, Local Lodge 3025, AFL-CIO (the Union and petitioner herein) ]. On March 1, 1977, Minneapolis Yellow instituted a "voluntary" leasing program at [Suburban] whereby, for a scheduled fee accompanied by a posted bond, the driver became a "lessee" of the cab for an agreed upon term and was entitled to keep his receipts rather than turn them in, as did the commission drivers. By August 1977, of the approximately 100 drivers operating the 50 taxicabs at [Suburban], all but eight drivers had opted to become lessees. Effective August 7, 1977, [Suburban] ceased using commission drivers, and since that time has operated exclusively with lessee drivers. [Minneapolis] Yellow Taxi has continued to operate solely with commission drivers. [Suburban], based on its assessment that lessee drivers are independent contractors, rather than employees, has refused to apply the terms of its collective bargaining agreements to [Suburban's] lessee drivers and has refused to bargain about their terms and conditions of employment.
Brief for Respondent at 4-5 (citations omitted). The Board ruled that Suburban's lessees are employees and that Suburban's refusal to bargain with the Union thus constitutes a violation of sections 8(a)(5) and 8(a)(1) of the Act.
A. The Operation of the Leasing Program
Drivers seeking leases from Suburban submit an application with references and a resume describing their driving experience. Those who are accepted sign a lease agreement and post a $100 to $250 bond, depending on the lessee's driving record. 5 Lessees are also required by the Airport, Bloomington and Richfield to pass a physical examination and to be licensed as cab drivers. 6
Suburban offers a wide variety of leases to applicant drivers. Drivers may contract for different periods ranging from eight hours, 24 hours, a weekend, or an entire week. Drivers may also extend their leases for extra hours. One newsletter to drivers described the range of available leases as follows:
We now have lease rates available to suit everyone's needs:
Day Lease from 6:00 a.m.-6:00 p.m.
Short a.m. I Lease 6:00 a.m.-12:00 noon
Short a.m. [p.m.] II Lease 12:00 noon-6:00 p.m.
Dog Lease 12:00 mid-12:00 noon
Dog Lease 12:00 noon-12:00 mid
And our new Single Shift Lease 6:00 a.m. to 6:00 p.m. 24 hrs.
Did you know that you can lease a fully equipped new Yellow Taxi with radio for $202.00 for the entire week? Why bother owning that second car, paying the insurance and maintenance on it, when you could be driving a fully insured, fully maintained Yellow for $202.00 a week?
Newsletter from J. Feldman, Suburban (undated) (JA 215).
Rates vary according to season and time of day. One announcement to drivers stated:
The rates for fall are as follows:
Single shift $35.00 per day, $202 per week
Days 25.00 per day
Nights 20.00 per night
Remember, the more days you lease the smaller your rate is.
Letter from Minneapolis-Yellow to Lessees at 2 (Oct. 3, 1977) (JA 210).
A wider selection of leases can scarcely be imagined. The available rental periods vary greatly. Extra hours may be added. Suburban is not obligated to renew or extend the term of the lease. Lessees are not required to account for the amount of fares collected, Tr. 132 (J.A. 227), or to accept any calls other than those the lessee may agree to accept. Tr. 34 (JA 95). Drivers are not restricted to any particular area, required to stand at any specified place, or assigned any particular lease periods.
In return for the leasing fee, which is paid when the lease agreement is signed, the lessee receives a fully equipped, licensed cab furnished with a meter and radio dispatch equipment (and the right to use the radio dispatch service), liability insurance, tires, anti-freeze, free towing service within 50 miles of Suburban's garage, and repair service for all damages determined not to be the driver's fault and for all damages in excess of the driver's posted bond. 7 The cabs bear the logo "Suburban Yellow Taxi," and the driver obtains the right to use Suburban's name and good will. He may not change the trade name. Article 7 of the lease agreement provides:
The relationship of employer-employee or principal-agent does not exist and is not intended to exist by either party to this lease. Instead, only a lease exists. Specifically:
a. Lessee's compensation is not guaranteed. All income derived from the use of the Taxicab by Lessee is the sole property of Lessee.
b. Lessee is at all times free from right of control and direction of Lessor in the operation of the Taxicab, or while the same is in Lessee's possession, and Lessor shall not exercise or attempt to exercise any supervision over the service performed by Lessee. Any rates of fare suggested by Lessor which are not regulated by law, ordinance or governmental rules or regulations are merely for the information of Lessee and Lessee is not obligated to charge such rates. [The municipalities regulate taxi cab rates].
c. Subject to compliance with [the law and existing regulations], Lessee shall not be required by Lessor to operate the Taxicab in any prescribed manner or accept any calls other than those which Lessee may of Lessee's volition agree to accept.
d. Lessee shall not be required to report the location or whereabouts of the Taxicab at any time during the lease period.
e. Lessee shall not be required to account to Lessor in writing or otherwise for any amounts collected from passengers. Lessee shall not be required to furnish Lessor any trip sheet or other record of Lessee's activities unless required by applicable law, ordinance or governmental rules or regulation, except for information relating to accidents or relating to the defense of any claims or suits against Lessor.
f. Subject to compliance with the provisions of [applicable law], Lessee shall not be restricted in any manner as to the area in which Lessee may operate the Taxicab.
g. Lessee shall not be required to have the Taxicab remain in any specified place or operated for any minimum number of hours during the lease term.
This agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be modified except in writing signed by Lessee and an Officer of Lessor.
Sample Lease, supra note 5, at 1 (JA 197). In addition, lessees may use the cab for pleasure and for personal business. See Tr. 186, 285 (JA 124, 147); Sample Lease, supra note 5, p 7b (JA 197).
Suburban is licensed in six municipal jurisdictions: The Airport, Bloomington, Richfield, Edina, Eden Prairie and Burnsville. "Lessees are free to prospect for fares independently," Brief for Respondent...
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