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Gateway Taxi Mgmt. v. Division of Employment Security

Supreme Court of Missouri, En Banc

May 12, 2015

GATEWAY TAXI MANAGEMENT, Appellant,
v.
DIVISION OF EMPLOYMENT SECURITY, Respondent

APPEAL FROM THE LABOR AND INDUSTRIAL RELATIONS COMMISSION.

Gateway Taxi Management was represented by Brian E. McGovern, Robert A. Miller and Bryan M. Kaemmerer of McCarthy, Leonard, Kaemmerer LC in St. Louis; and William E. Quirk of Polsinelli PC in Kansas City.

The division was represented by in-house counsel Christopher R. Miller in Jefferson City.

The Independent Taxi Driver Association LLC, which submitted a brief as a friend of the Court, was represented by Drew C. Baebler of Bauer & Baebler PC in St. Louis.

Zel M. Fischer, Judge. All concur.

OPINION

Zel M. Fischer, Judge.

Page 831

The Labor and Industrial Relations Commission (LIRC) determined that Gateway Taxi Management, d/b/a Laclede Cab Company (" Laclede" ), is liable for unemployment tax because its taxi drivers are " employees" under § 288.034.5.[1] This Court holds that the LIRC's decision is supported by competent and substantial evidence upon the whole record and affirms.

Factual Background

Laclede operates a taxi service in the St. Louis metropolitan area. When Laclede hires drivers it has them sign an " Independent Contractor Agreement." The agreement states, " [I]t is intended by the parties that the status of Driver is solely that of an independent contractor . . . ." The title of this agreement, and this one sentence in the agreement, is not dispositive of this unemployment tax case.[2] The agreement gives drivers a certain amount of control over their operations. For instance, it allows them to choose the hours they work. Drivers may also use their own vehicles or lease cabs from the 140-car fleet belonging to an affiliate of Laclede. Drivers who lease can choose between 12-hour and 24-hour shifts and, although, Laclede pays for insurance and maintenance of the cabs, drivers must pay for their own cleaning and fuel.

However, the agreement also restricts drivers in certain ways and gives Laclede control over other aspects of the drivers' operations. Drivers who use their own cabs must paint their cars the same as the fleet, use the same signage, and pay a weekly fee to Laclede. Drivers who lease from Laclede's affiliate have only two options: 12- or 24-hour shifts. The cabs are to be used solely for business purposes and are not to be subleased by the drivers. Drivers are required to use Laclede's GPS-based dispatch system, and Laclede instructs drivers to funnel all potential customers through that system. Drivers are not allowed to have cell phones with them while driving for Laclede. While drivers may keep all cash collected, Laclede takes a 10% cut from credit card receipts and receipts from certain company vouchers, both of which drivers are required to accept. In addition to the terms of the agreement, Laclede and the drivers are subject to the Metropolitan St. Louis Taxicab Commission's Vehicle for Hire Code (VHC).[3] The VHC requires compliance from both Laclede and the drivers for issues such as: driver's licensing; appropriate

Page 832

and authorized colors, logo, trademark, symbols, and lettering, and furnished with all the necessary equipment.

A deputy of the Division of Employment Security (DES) determined that Laclede owed employment tax between 2009 and 2011 because Laclede drivers performed services for " wages" in the " employment" of Laclede. Laclede appealed the determination, and, after a hearing, the appeals tribunal reversed. DES then appealed to the LIRC. The LIRC reversed, finding the drivers were employees of Laclede. ...


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