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Atlanta-area stagehands are contractors, not employees, the Eleventh Circuit ruled last week. In so doing, the court reversed a finding by the National Labor Relations Board that stagehands placed through Crew One Productions were employees entitled to union representation.
Instead, the court found that Crew One exercised too little control over the stagehands for them to be considered employees. The finding could have an impact on similar lawsuits throughout the country, including recent challenges to "sharing economy" companies like Uber.
Bring a Wrench and Be Sober
Crew One operated somewhat as a clearing house for stagehands. It contracted with event producers for stagehand services for concerts, plays, and the like, then referred those positions out to workers on a first-come, first-served basis.
Crew One negotiated the amount of stagehands needed and the hourly rate for each, but it otherwise did not exercise much control over the day-to-day work of the stagehands, according to the Eleventh Circuit. It trained stagehands in safety, for example, and maintained a workers' compensation insurance policy.
Aside from safety procedures though, Crew One had only four client policies required of stagehands: stagehands must be sober; may not interact with artists; must bring a six-inch crescent wrench; and must return to load-out an event after they have "loaded-in."
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In 2014, the International Alliance of Theatrical Stage Employees petitioned the NLRB to represent the stagehands. The regional director found that the stagehands were employees and directed an election to certify the union.
The Eleventh Circuit did not agree, however. Applying the ten factor test from the Restatement (Second) of Agency, the court identified five errors with the NLRB's determination.
1. Crew One does not have the right to exercise control over the stagehands;
2. Crew One did not withhold taxes, leaning strongly in favor of a finding that stagehands are independent contractors;
3. Stagehands signed an "independent contractor agreement," which is evidence of the parties' intent;
4. "Negotiations over pay are irrelevant;"
5. The stagehands work is not "part of the business of Crew One."
The ruling is likely to have an impact on future disputes over the status of "gig economy" workers, be they stagehands, on-demand drivers, or delivery men.
The ride sharing app Uber is currently facing a host of challenges from its drivers, who argue that they are employees, not contractors. The company is facing a class action lawsuit in California while the International Brotherhood of Electrical Workers, Local 1430, has petitioned to represent more than 600 Uber drivers in New York City.
Jon Hyman, partner in the Labor & Employment practice of Meyers, Roman, Friedberg & Lewis, predicts that "the NLRB will conclude that Uber drivers have the right to organize as employees," but today's ruling makes it more uncertain whether that determination would hold up in court.