West Cab Co., Inc. v. INDUSTRIAL COM'N

JUSTICE DONOVAN,

dissenting:

I do not agree with the majority’s view that the Commission’s decision regarding the existence of an employer-employee relationship is contrary to the manifest weight of the evidence, and I do not believe that the majority has identified a good cause or compelling reason to overrule the holding in Yellow Cab Co. v. Industrial Comm’n, 238 Ill. App. 3d 650, 606 N.E.2d 523 (1992). In my view, the resolution of the question of the existence of an employer-employee relationship is controlled by the line of “cab lease” cases including Morgan Cab Co. v. Industrial Comm’n, 60 Ill. 2d 92, 324 N.E.2d 425 (1975), and Yellow Cab, 238 Ill. App. 3d 650, 606 N.E.2d 523. Therefore, I must respectfully dissent.

Whether an employer-employee relationship exists between a respondent and a claimant is primarily a question of fact to be decided by the Commission, and a reviewing court will not disturb the factual findings of the Commission unless they are contrary to the manifest weight of the evidence. Crepps v. Industrial Comm’n, 402 Ill. 606, 609, 85 N.E.2d 5, 6-7 (1949). Thus, the question before us is not whether an employer-employee relationship existed between the parties at the time of the accident, but whether the Commission’s finding that such relationship did exist is against the manifest weight of the evidence or lacks a substantial foundation in the evidence. Crepps, 402 Ill. at 609, 85 N.E.2d at 7.

There is no rigid rule of law defining whether a worker is an employee or an independent contractor. Ware v. Industrial Comm’n, 318 Ill. App. 3d 1117, 1122, 743 N.E.2d 579, 583 (2000). In considering whether a worker is an employee or an independent contractor, the Commission may consider a number of factors, including the right to control the manner in which the work was done, the method of payment, the right to discharge, the skill required in the work to be done, and the provider of the materials and equipment (Morgan Cab, 60 Ill. 2d at 97, 324 N.E.2d at 428), and the nature of the claimant’s work in relation to the employer’s business is also a significant factor (Ragler Motor Sales v. Industrial Comm’n, 93 Ill. 2d 66, 71, 442 N.E.2d 903, 905 (1982)). Of these factors, the right to control the work has been considered a predominant factor in determining the relationship of the parties. Morgan Cab, 60 Ill. 2d at 97-98, 324 N.E.2d at 428. In that regard, it is the right of control, not the fact of control, that is the principal factor in distinguishing an employee from an independent contractor. Davila v. Yellow Cab Co., 333 Ill. App. 3d 592, 596, 776 N.E.2d 720, 724 (2002).

In Morgan Cab, the Illinois Supreme Court was called upon to consider whether a taxi driver who drove a cab under circumstances similar to the case at bar was an employee or an independent contractor of the cab company. See Morgan Cab Co., 60 Ill. 2d at 98-99, 324 N.E.2d at 428-29. Since it was a case of first impression, the Illinois Supreme Court considered the issue of the cab company’s right to control the manner in which the claimant performed his work in light of decisions from other jurisdictions and stated as follows:

“In Hannigan v. Goldfarb (1958), 53 N.J. Super. 190, 147 A.2d 56, the cab driver paid $8 per 12-hour shift for the use of a cab. The driver kept all fares and tips and paid for all of his gasoline and oil. The court in holding for the claimant under the Workmen’s Compensation Act rejected the cab owner’s argument that the driver was not an employee as he was not compelled to work. It has been argued the driver could ignore the dispatcher’s messages, park his cab and go to sleep if he chose. The court said the argument was unrealistic and that the cab owners would not tolerate such conduct by a driver. The court held that the cab owner had the right to control the work of the driver within the limitations set by the very nature of a cab driver’s work. Too, the court asked itself the question whether the cab owner was merely engaged in the leasing of taxicabs or was he operating a fleet of taxicabs as a business. It concluded that he was in the business of operating taxicabs. In this connection the court quoted from Kaus v. Huston (N.D. Iowa 1940), 35 E Supp. 327, 331, a case in which it was held that a cab driver was to be deemed an employee and entitled to unemployment benefits. The language quoted is relevant here:

‘ “By narrow technical analysis of such relationship and particularly plaintiffs claimed want of control over the drivers, it is argued that the relationship of master and servant does not exist. It seems to me that this view of the question is too narrow. The real question for solution is, Does the plaintiff engage merely in the leasing of taxicabs, or does he operate a line of taxicabs as a common carrier of passengers? When all factors are considered and particularly the contractual relationship of the plaintiff with the passengers carried, I think there can be little doubt that plaintiff is operating the line of taxicabs, and that while he has adopted an ingenious method of fixing the compensation of his drivers and permits the drivers to exercise some discretion over the cab during the period of the driver’s shift, nevertheless I think there is no discretion vested in the drivers inconsistent with the relation of master and servant. From the very nature of the case the drivers, in order to perform their duties properly, must exercise very complete control over the cabs while they have them out on their shifts.”

*** [W]hen all factors are considered we think there can be little doubt *** they are *** his employees. One cannot call these drivers “independent contractors” *** without embarrassment.’ Hannigan v. Goldfarb, 53 N.J. Super. 190, 206-207, 147 A.2d 56, 65-66.” (Emphasis omitted.) Morgan Cab, 60 Ill. 2d at 98-99, 324 N.E.2d at 428-29.

Having considered the issue of an employer-employee relationship in light of the reasoning expressed by courts in other jurisdictions and its own reasoning in unemployment compensation cases, the supreme court concluded that the evidence established that the cab company had the right to control the activities of the driver and that the cab company was in the business of operating a fleet of cabs for public use, rather than merely leasing vehicles with no interest in their operation as taxis.

As noted in the majority opinion, the resolution of the control factor has been influenced by circumstances such as whether the driver accepts radio calls from the company; whether the driver has his radio and cab repaired by the company; whether the leased vehicles were painted alike with the name of the company and its phone number on the vehicles; whether the company could refuse the driver a cab; whether the company controls work shifts and assignments; whether the company dictates where the drivers may purchase gas or obtain repair or tow services; whether the company requires the drivers to be courteous with customers; whether the company has the right to discharge the driver or cancel the lease; whether the company lease prohibits subleasing; and whether the company was in the business of operating a fleet of cabs for public use. Yellow Cab, 238 Ill. App. 3d 650, 606 N.E.2d 653.

Considering the evidence in this case in light of the aforementioned principles and legal authorities, I conclude that the Commission’s finding of an employer-employee relationship between the respondent and the claimant’s decedent is supported by the evidence and is not against the manifest weight of the evidence. While this is certainly a close case, I find sufficient evidence in the record to support the Commission’s findings that the respondents retained the right to control the manner in which the work was performed and that the respondents were in the business of operating a fleet of cabs for the use of the Schiller Park community.

In the case at bar, the lease agreement expressly disclaims an employer-employee relationship between the parties. Similar disclaimers were present in Globe Cab Co. v. Industrial Comm’n, 86 Ill. 2d 354, 427 N.E.2d 48 (1981), Yellow Cab, 238 Ill. App. 3d at 652, 606 N.E.2d at 525 (hereinafter Yellow Cab II), and Yellow Cab Co. v. Industrial Comm’n, 124 Ill. App. 3d 644, 464 N.E.2d 1079 (1984) (hereinafter Yellow Cab I). In each of those cases, the reviewing court affirmed the Commission’s finding that the claimant was an employee of the cab company, concluding that the disclaimer alone was not dispositive of the claimant’s status and that other factors supported the finding of an employer-employee relationship. See Globe Cab, 86 Ill. 2d 354, 427 N.E.2d 48; Yellow Cab II, 238 Ill. App. 3d at 652, 606 N.E.2d at 525-26; Yellow Cab I, 124 Ill. App. 3d at 647, 464 N.E.2d at 1081.

The lease agreement provides that the respondents own the taxicabs that are referred to as Northwest Cabs and West Cabs; that the respondents’ cabs operate in the Schiller Park area of Cook County; that the respondents maintain offices, telephone, radio and other facilities for the reception of requests for taxi service from the general public at a central location in Schiller Park; and that the lessee be licensed as an operator and chauffeur. The lease also provides in pertinent part as follows:

“3. Lessee shall comply with all applicable laws, ordinances and regulations, whether federal, state, or local, pertaining to the operation of a taxicab-, that he will turn over to the Lessor at the end of the rental period any records required to be kept by him by such laws, ordinances or regulations; that he will cooperate with the Lessor to recover all losses incurred by the Lessor due to accident; that he will not repair the taxicab except at places designated by Lessor unless prior approval for such other repair is given.

* * *

6. Upon completion of each rental period hereunder, either party may refuse to renew this contract, in which event this contract shall be deemed terminated.

* $5? *

8. The fare structure shall be in accordance with the tariff rates approved by Schiller Park, Illinois, in accordance with schedules filed and any amendments thereto ***.” (Emphasis added.)

In its opinion, the majority seems to focus on provisions in the lease that appear to give a lessee complete freedom to operate the respondents’ taxicab in any way he chooses, to the exclusion of other provisions, including those set forth above, which clearly show that the respondents have retained a right to control a lessee’s activities in accordance with their interests in operating their taxicab business, and that the work performed by a lessee was essential to the respondents’ business operations.

For example, the majority points to the business manager’s testimony that the drivers were not required to respond to radio dispatches from the company, but seemingly discounts the significance of his testimony that the respondents employed dispatchers 24 hours per day to notify the drivers about customers requesting taxi service. In my view, the provision of around-the-clock dispatchers is significant because it demonstrates that the respondents were in the business of operating a fleet of cabs for public use and that the work performed by the claimant’s decedent was integral to the success of the respondents’ business operations.

In its opinion, the majority seems to ignore a number of requirements and restrictions that the respondents imposed on the drivers who leased their taxis. The drivers were also required to have a valid operator’s or chauffeur’s license, to operate a cab bearing the logo and the telephone number of the respondents, to obtain repairs and maintenance at places designated by the respondents, and to comply with federal, state, and local regulations. The drivers were prohibited from subleasing the cab. The respondents could refuse to renew a lease. Given the number and nature of the requirements and restrictions, it is difficult to conclude that the respondents lacked control of the manner in which the work was performed or that the respondents were engaged in anything other than the business of operating a fleet of cabs for public use. See Globe Cab, 86 Ill. 2d at 363, 427 N.E.2d at 52. While reviewing the applicable case law on the existence of an employer-employee relationship, I found compelling a line in the Yellow Cab II case, wherein this court noted that “[t]he driving of the taxicabs in the fleet is certainly an integral part of the employer’s business, and there is no other channel in this case through which the costs of claimant’s work-related death can flow.” Yellow Cab II, 238 Ill. App. 3d at 655, 606 N.E.2d at 526-27; see also Globe Cab, 86 Ill. 2d at 363, 427 N.E.2d at 52-53 (Ryan, J., concurring).

Finally, I note that the majority has gone beyond reversing the circuit court’s decision confirming the Commission’s finding of an employer-employer relationship. In its opinion, the majority writes, “To the extent that our decision in the instant matter may be at odds with the holding in Yellow Cab, we now overrule that holding.” 376 Ill. App. 3d at 405. This court does not generally depart from established case law absent a good cause or compelling reasons. I am troubled by the majority’s failure to articulate what part or parts of its opinion could be considered “at odds” with the holding in Yellow Cab II, and its failure to provide any cause or reason to support its decision. I find no basis on which to overrule Yellow Cab II. I find that the Commission’s finding that the claimant’s decedent was an employee of West Cab Company and Northwest Cab Company is supported by the evidence and is not against the manifest weight of the evidence. Accordingly, I would affirm the decision of the circuit court confirming the Commission’s decision in all respects except for its finding that Northwest Package Delivery Service, Inc., is an employer of the claimant’s decedent.