Lack of control over driver shows independent contractor relationship

In Tennessee, the primary factor for determining a worker's status as an employee or an independent contractor is the employer's right to control the conduct of the work.

Case name: Mohamed v. Taxi USA of Tennessee, LLC d/b/a Allied Car Co., et al., No. M2010-02062-WC-R3-WC (Tenn. 02/10/12).

Ruling: The Tennessee Supreme Court held that a driver was not entitled to benefits for his injuries because he was an independent contractor.

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What it means: In Tennessee, the primary factor for determining a worker's status as an employee or an independent contractor is the employer's right to control the conduct of the work.

Summary: A taxicab driver was injured when he was involved in a motor vehicle accident while driving his taxi. He had entered into an agreement of association with a taxi company. He sought benefits from the company. The company denied that he was an employee, asserting that he was an independent contractor and not entitled to benefits. The Tennessee Supreme Court held that he was not entitled to benefits.

The court found that the company did not have the right to control the driver's conduct of his work. The city controlled the permit application process for drivers and provided training. The city also promulgated regulations concerning driver appearance and the safety, maintenance, and cleanliness of vehicles. The company had some control over drivers through its dispatch system. However, the company did not dictate in what particular geographic area the driver worked or the driver's work schedule.

The court also found that the driver's month-to-month term that could be terminated at the end of any term by either party was more consistent with an independent contractor relationship. The method of payment was also consistent with an independent contractor relationship. The driver paid a weekly fee to the company. The company did not deduct income tax and did not provide an insurance or retirement benefits to him.

The court also pointed out that the driver owned his taxi, was responsible for its maintenance and repairs, and was required to pay for his own insurance. He had to paint his vehicle to bring it into conformity with the company's specifications. The roof light, credit card machine, radio, and a cellphone were provided by the company, but the driver paid a weekly fee to use the equipment.

Read more at the WorkersComp Forum homepage.

April 23, 2012

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