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Cable company not joint employer of cable installation technicians

By Ronald Miller, J.D.

Finding that a cable company’s involvement in the hiring, firing, supervision, scheduling, and payment of cable installation technicians was minimal, a federal district court in Louisiana concluded that it was not a joint employer of the technicians. Here, the court determined that a background check requirement, distribution of work orders, and customer satisfaction surveys reflected no more than a legitimate contractor relationship between the cable company and the contractor it hired to provide installation and maintenance services (Crosby v. Cox Communications, Inc., May 1, 2017, van Meerveld, J.).

Cable installation technicians brought suit against Cox and Superior Telecom for failing to pay them and other installers overtime in violation of the FLSA and Louisiana’s wage payment laws. The installers alleged that Cox and Superior were liable as their employers for failing to pay them for work in excess of 40 hours in a work week. Cox filed motion for summary judgment on basis that it was not the technicians’ employer.

Superior-Cox relationship. Cox provides cable, telephone and internet services to various residences and businesses. To access these services, customers buy cable equipment from Cox. Cox contracts with third parties, like Superior, to provide installation and maintenance services to its customers. Superior provided services for Cox from June 2013 until May 2016. Cox’s relationship with Superior during the relevant time period was governed by a field services agreement (FSA) between the parties. Pursuant to the FSA, Superior is an “independent contractor” and none of its employees or representatives were to be deemed a Cox employee, agent, or representative.

Superior contracted with a company called Stargate Communication to provide the services contemplated under the FSA. The plaintiffs’ tax documents indicate that they were paid by Stargate as independent contractors. According to Cox, Superior was required to provide Cox with notice prior to contracting with another vendor to provide services under the FSA, but Superior did not notify Cox about Stargate. Cox does not have a contract with Stargate and has never issued any work orders to Stargate.

It was uncontested that Cox does not share office space or warehouses with Superior or Stargate. Nor did it have any ownership interest in Superior or Stargate. Stargate was formed by a Superior supervisor. Although the technicians worked for Stargate, they reported to Superior’s offices.

Hiring and firing. The FSA required that Superior “maintain adequate, qualified, experienced and professional-appearing” personnel. Superior agreed that it would subject all of its personnel to background checks (including drug screenings and a criminal background check) before they could perform services contemplated by the FSA.

The technicians presented no evidence to contradict a declaration that Cox had no input in the decision to hire them. It was also undisputed that Cox did not hire the technicians directly. When they left their employment, they notified Stargate, not Cox. Further, the technicians presented no evidence that Cox had any involvement or input in the hiring and firing decisions or Superior or Stargate.

Supervision and control. When a Cox customer requests installation and maintenance services, this request creates a “work order” in Cox’s automated billing system. Work orders are bundled and sent to Superior. Superior can assign the work orders to technicians in any manner it sees fit, and Cox learns the technician number for the individual who performs the work order when the order is completed and recorded in the billing system. The technicians did not report to Cox supervisors, but instead were supervised by individuals with Superior or Stargate.

However, the FSA did require that technicians identify themselves as independent contractors of Cox, and follow Cox’s branding and identification guidelines. They wear badges and drive vehicles stating “Authorized Vendor for Cox Communications.” Cox conducts random qualify control checks and requests that its customers complete surveys. It discussed customer complaints, surveys and quality control checks only with Superior management.

The FSA also required that Superior train all technicians on safety, quality and legal requirements of the agreement, including training on Cox guidelines and requirements. None of the technicians received any training from Cox. Further, Cox did not supply Superior technicians with tools or supplies to perform their work.

Joint employer liability. As an initial matter, the court considered whether Cox was a joint employer with Superior or Stargate. Employing the “economic reality test,” courts consider whether the alleged employer “(1) possessed the power to hire and fire the employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records.”

Control of work. The court found that Cox was not involved in hiring, firing, supervision, control of schedules, and pay of the technicians. Cox’s requirement that technicians entering into customers’ homes pass its background check did not give Cox the authority to hire and fire. Further, a contractual provision allowing Cox to terminate its contract with Superior could not be interpreted as being sufficient to find authority over Superior’s hiring and firing decisions. Thus, the contractual requirements of the FSA did not amount to direct or even indirect power or control over hiring and firing, so that Cox had no authority to hire or fire Superior technicians.

Similarly, Cox did not supervise or control the work schedules or conditions of employment of Superior’s technicians. Although Cox’s computer system allocated work orders to technician numbers, Superior had the power to assign work orders as it saw fit, and did not have obtain Cox’s consent for such changes. Further, there was no evidence that Cox was involved with approving or scheduling technicians’ time off requests. The fact that Cox required that the technicians wear clothing and drive vehicles identifying them as Cox approved was merely to ensure that the appropriate person in entering the customers’ home. Thus, the supervisor factor weighed against a finding that Cox was the technicians’ employer.

Payment. Additionally, there was no dispute that the technicians were paid by Superior or Stargate, not by Cox. Cox did not issue tax documents to the technicians and never made deductions from their paychecks and never instructed Superior to do so. Further, there was no evidence that payments to technicians were contingent on Superior receiving payment from Cox. Thus, the payment factor weighed against a finding of joint employment. Finally, it was uncontested that the only records maintained by Cox related to the technicians’ badges; thus, this factor also weighed against finding that Cox was a joint employer. Accordingly, the court concluded that Cox did not have the ability to control the work of the plaintiffs, and so was not an “employer” of the technicians.