STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
GASPARE B. TAMBURELLO, )
)
Petitioner, )
vs. ) CASE NO. 92-7366
) DEPARTMENT OF MANAGEMENT SERVICES, ) DIVISION OF RETIREMENT, )
)
Respondent. )
)
RECOMMENDED ORDER
This matter came on for hearing in Pensacola, Florida, before Robert T. Benton, II, Hearing Officer of the Division of Administrative Hearings, on June 7, 1993.
The parties filed proposed recommended orders on June 18, 1993. The attached appendix addresses proposed findings of fact by number.
APPEARANCES
For Petitioner: M. J. Menge, Esquire
Shell, Fleming, Davis & Menge Post Office Box 1831 Pensacola, Florida 32598
For Respondent: Stanley M. Danek, Esquire
Division of Retirement
Cedars Executive Center-Bldg. C 2639 North Monroe Street Tallahassee, Florida 32399-1560
STATEMENT OF THE ISSUES
Whether petitioner must forfeit retirement benefits in the amount of
$7,889.26 on account of work he performed for Pensacola Junior College from August 1, 1987, through June 30, 1988?
PRELIMINARY STATEMENT
By letter dated November 4, 1992, A. J. McMullian, III, State Retirement Director, informed respondent Gaspare B. Tamburello that he was "not entitled to the retirement payments ($7,889.26) [he] received from August 1987 through June 1988" because a recent state retiree "may not receive both a salary from reemployment with any agency participating in the Florida Retirement System and retirement benefits." Respondent's Exhibit No. 3.
Respondent contends petitioner ran afoul of the reemployment limitation provisions of the Florida Retirement System law, Section 121.091(9), Florida Statutes, because his retirement from Pensacola Junior College (the College) had
only become effective July 1, 1987. The letter of November 4, 1992, reflected respondent's "free form" determination, after reviewing petitioner's contract with the College for the period August 1, 1987, through June 30, 1988, and other information supplied by the College, that petitioner was an employee of the College during the period in question, and not an independent contractor.
Within the time allowed by law, petitioner filed a petition for formal proceedings contesting respondent's proposed decision. In accordance with Section 120.57(1)(b)3., Florida Statutes (1992 Supp.), respondent forwarded the matter to the Division of Administrative Hearings for proceedings de novo.
FINDINGS OF FACT
After retiring from the United States Navy as a Captain, petitioner Gaspare B. Tamburello, 72 years of age at the time of the hearing, began working for Pensacola Junior College on August 2, 1969. He spent two years as the College's Director of Veteran Affairs, then became its Director of Administrative Services. By July 1, 1987, when he retired from the College, he had become Assistant to the President.
As Assistant to the President, Dr. Tamburello's duties, although many and varied, did not include fund raising or any participation in efforts to create new educational programs. He reported to the President and performed duties the President assigned, including:
Serv[ing] as the college's community liaison representative to develop and maintain opt- imum relationships between the college and the community. [by]
Represent[ing] the President, in his absence, at community events, councils, and committees.
Coordinat[ing] for the college special community and civic events held on campus.
Prepar[ing] special briefings and presen- tations.
Arrang[ing] tours for representatives of all segments of the community.
Serv[ing] as the President's campus ombudsman.
[Taking r]esponsib[ility] for special pro- jects and reports on a variety of subjects as assigned by the President.
Coordinat[ing] special events and activities for formal ceremonies. Prepar[ing] corres- pondence for the President's signature.
Act[ing] as liaison for President at his direction.
Supervis[ing] the College Public Relations function.
Perform[ing] related duties as required or deemed appropriate to the accomplishment of the responsibilities and functions of the position.
Respondent's Exhibit No. 5. While Assistant to the President, he met mornings with Horace E. Hartsell, the College's president, to lay out plans for the day. The College provided petitioner an office next to President Hartsell's, secretarial services, and all his supplies.
Until July 1, 1987, the College paid petitioner from its payroll account, withholding a portion of his wages to pay federal income taxes and Social Security taxes. Petitioner received all the fringe benefits the College gave its other employees, including health and hospitalization insurance, life insurance, paid holidays, sick leave, annual leave, contributions on his behalf to the Florida Retirement System, and workers' compensation coverage.
When he learned petitioner intended to retire, President Hartsell asked him to consider working as a consultant to the College after his retirement.
Dr. Tamburello prepared the following memorandum, dated May 21, 1987:
PENSACOLA JUNIOR COLLEGE MEMORANDUM
TO: Dr. Hartsell FROM: G. B. Tamburello
You asked that I identify areas in which I can serve under the proposed consulting con- tract. The following activities could be assigned under the contract as needed.
Community Relations
Assist Dr. Crosby in obtaining community support for PJC Future Fund.
Assist in developing Community Needs Assessment Project.
Develop contacts for expansion of the USA Achievement Program.
As directed by you for special purposes.
NAVY Relations
Lobby for Gulf Region Homeporting Ships Educational Programs.
Help develop local homeporting education liaison programs.
Arrange courtesy calls with new Commanding Officers.
Attend special military functions as requested.
PJC Seniors Club
Continue to act as advisor to the club.
Attend monthly and executive committee
meetings.
Coordinate Seniors Club campus facili- ties and logistical needs.
Develop special programs of interest to PJC Seniors Club members.
Veterans Affairs
a. Discuss with Reserve Units Reserve GI Bill opportunities.
Continuing Education
Develop PJC Pre-Retirement Program.
Develop Pre-Retirement Program for community businesses and commercial establishments.
Develop special life-long learning educational programs.
Develop new non-credit PJC Seniors Academy program.
International Education
a. Assist in the development of recruiting program to attract the international student to PJC campuses.
Special Studies and Projects as requested
Dr. Hernandez, Jay Mooney, and Betty Dexter approached me about the possibility of being of assistance to them under the contract.
I have also discussed the Continuing Education functions with Dr. Betsy Smith who is very pleased with the assistance I might render.
Respondent's Exhibit No. 9. The parties later executed a written agreement under which petitioner performed consulting services for the College from August 1, 1987, to June 30, 1988, in exchange for six thousand dollars ($6,000).
When Dr. Tamburello retired, the College was paying him at an annual rate of approximately $31,500. Some two weeks after Dr. Tamburello's retirement, David Armstrong became Assistant to the President, filling the regularly established position Dr. Tamburello had vacated and succeeding to his duties. The job description remained unchanged.
The consulting contract specified that petitioner would act as an independent contractor while performing services under the contract, and that he would not be an employee of the College. Petitioner reported the income he received under the consulting contract to the Internal Revenue Service on Schedule C. Petitioner's Exhibit No. 10. He filled no position at the college. For his services under the consulting contract, the College paid him from its accounts payable account, and withheld no funds to pay federal income taxes or Social Security taxes.
The College did not provide petitioner with an office, assign a secretary, or give him materials and supplies, and petitioner received none of
the fringe benefits enjoyed by employees of the College. The College did not reimburse petitioner for expenses he incurred while performing services as a consultant.
Although the College contracted directly with Dr. Tamburello and all parties evidently contemplated his personal services, he was not prohibited from hiring others to assist him in performing services under the consulting contract, according to unrebutted testimony from College officials. In 1987 Nova University paid petitioner $6,000 and in 1988 $9,000.00 for services he performed for that school. Petitioner had formed E&T Management Service Co. prior to 1987, and offered his services as a consultant to the general public.
Only after August 1, 1987, when Dr. Tamburello's consulting contract became effective, did he begin working with Elizabeth Smith, then Dean of Continuing Education, in an effort to establish an elder hostel program at the College, as part of a "life long learning center" with "seniors teaching seniors." He also conceived and organized the College's "Lex flex" program: classes for members of the crew of the U.S.S. Lexington were scheduled to coincide with the ship's stays in Pensacola, its home port.
While working under the consulting contract, he solicited contributions for the College's "Future Fund," and facilitated one donation to the college that amounted to approximately a quarter of a million dollars. He conducted "pre-retirement seminars" at which bankers, lawyers, social security officials and others addressed older members of the community. The Pensacola Junior College Seniors Club, which he started, now has 1500 members.
In performing services under the consulting contract, petitioner set his own hours and determined the type and sequence of the work he performed. While not subject to their control, he reported to the President and the Dean of Continuing Education, as ideas or plans unfolded. The pre-retirement seminars took place on campus and he occasionally met with Dean Smith or President Hartsell in their offices, but, as a consultant, for the most part, he worked off campus; he had an office at his home.
Petitioner kept track of the various tasks he performed. At varying intervals, he reported how many hours he had worked to Dean Smith, and was paid accordingly, in keeping with the consulting contract. Thirteen of a total of
101 entries reflected that he had done something at President Hartsell's request, typically attend a change of command ceremony as a representative of the College. The President forwarded notices of such events to him, but did not actually request that he attend; sometimes he attended, sometimes he did not. Ten entries reflected time petitioner spent introducing Dr. Armstrong to community leaders. At least nine entries pertained to the "PJC Senior Club." Respondent's Exhibit No. 10. He wrote a single three-minute introduction President Hartsell delivered, but did no other speech writing.
Petitioner's experience as a naval officer, his study of the educational needs of the elderly, as evidenced by his doctoral thesis on the educational needs of the elderly, entitled "Project ESP: Education Support Plan for the Aged, and his civic activities all prepared him for the work he performed as a consultant. Before entering into the consulting contract with the College, petitioner had been active in a wide range of community affairs.
By June of 1985, petitioner's interest in his retirement benefits had fully vested. Taking into account the twenty factors utilized by respondent as
guidelines to determine whether an individual is an employee or an independent contractor, petitioner's status was that of an independent contractor.
Some time after 1988, respondent audited the College's records, but did not advise the College that petitioner should be deemed an employee rather than an independent contractor under the terms of the 1987-88 contract. Only later, after an audit performed by the Auditor General's office, did respondent inform him of its contention that he must forfeit $7,889.26 in retirement benefits previously paid to him. The first notice petitioner received from respondent to that effect was dated September 9, 1992.
CONCLUSIONS OF LAW
Since the Division of Retirement of the Department of Management Services referred respondent's hearing request to the Division of Administrative Hearings, in accordance with Section 120.57(1)(b)3., Florida Statutes (1992 Supp.), "the division has jurisdiction over the formal proceeding." Section 120.57(1)(b)3., Florida Statutes (1992 Supp.).
Section 121.091(9), Florida Statutes, requires forfeiture of retirement benefits by a retiree who, within twelve months of retirement, is re-employed by an employer that participates in the state administered retirement system.
(b)1. Any person who is retired under this chapter, except under the disability retire- ment provisions of subsection (4), may be reemployed by any private or public employer after retirement and receive retirement bene- fits and compensation from his employer with- out any limitations, except that a person
may not receive both a salary from reemploy- ment with any agency participating in the Florida Retirement System and retirement bene- fits under this chapter for a period of 12 months immediately subsequent to the date of retirement.
2. Any person to whom the limitation in sub- paragraph 1. applies who violates such re- employment limitation and who is reemployed with any agency participating in the Florida Retirement System before completion of the 12-month limitation period shall give timely notice of this fact in writing to his emp- loyer and to the division and shall have his
retirement benefits suspended for the balance of the 12-month limitation period. Any retirement benefits received while reemp- loyed during this reemployment limitation period shall be repaid to the retirement trust fund, and retirement benefits shall remain suspended until such repayment has been made. Benefits suspended beyond the re- employment limitation shall apply toward re- payment of benefits received in violation of the reemployment limitation.
11. The limitations of this paragraph apply to reemployment in any capacity with an "emp- loyer" as defined in s. 121.021(10), irre- spective of the category of funds from which the person is compensated.
Section 121.091(9), Florida Statutes (1991). The forfeiture provision does not, however, apply to a retiree who works as an independent contractor and not as an employee. Davis v. Department of Administration, 585 So.2d 421 (1st DCA Fla.
1991).
The Division of Retirement has defined independent contractors for its purposes in Rule 60S-6.001(33), Florida Administrative Code. Although Rule 60S- 6.001(33), Florida Administrative Code, took effect after petitioner's consulting contract ended, testimony that the rule codifies the policy in effect at the time went unrebutted. The rule provides:
(33) INDEPENDENT CONTRACTOR - Means an in- dividual who is not subject to the control and direction of the employer for whom work is being performed, with respect not only to what shall be done but to how it shall be done. If the employer has the right to exert such control, an employer-employee relationship exists and the person is an employee and not an independent contractor. The Division has adopted the following factors as guidelines to aid in determining whether an individual is an employee or an independent contractor. The weight given each factor is not always the same and varies depending on the particular situation.
INSTRUCTIONS: An employee must comply with instructions from his employer about when, where, and how to work. The instruct- ions may be oral or may be in the form of manuals or written procedures which show
how the desired result is to be accomplished. Even if no actual instructions are given, the control factor is present if the employer has the right to give instructions.
TRAINING: An employee is trained to perform services in a particular manner. This is relevant when the skills and exper- ience which would be used as an independent
contractor were gained as a result of previous employment. Independent contractors ordin- arily use their own methods and receive no training from the purchasers of their ser- vices.
INTEGRATION: An employee's services are integrated into the business operations be- cause the services are critical and essen- tial to the success or continuation of an agency's progress/operation. This shows that the employee is subject to direction and con- trol.
SERVICES RENDERED PERSONALLY: An emp- loyee renders services personally. This shows that the employer is interested in the methods as well as the results. Lack of emp- loyer control may be indicated when a person has the right to hire a substitute without the employer's knowledge or approval.
HIRING ASSISTANTS: An employee works for an employer who hires, supervises, and pays assistants. An independent contractor hires, supervises, and pays assistants under a contract that requires him or her to pro- vide materials and labor and to be respon- sible only for the result.
CONTINUING RELATIONSHIP: An employee has a continuing relationship with an employer.
A continuing relationship may exist where work is performed at frequently recurring, although irregular intervals.
SET HOURS OF WORK: An employee usually has set hours of work established by an emp- loyer. An independent contractor is the master of his or her own time and works on his own schedule.
FULL-TIME OR PART-TIME WORK: An emp- loyee may work either full-time or part-time for an employer. Full-time does not necess- arily mean an 8-hour day or a 5 or 6-day week. Its meanings may vary with the intent of the parties, the nature of the occupation
and customs in the locality. These conditions should be considered in defining "full-time." An independent contractor can work when and for whom he or she chooses.
WORK DONE ON PREMISES: An employee works on the premises of an employer, or works on a route or at a location designated by an employer. The performance of work on the employer's premises is not controlling in itself; however, it does imply that the emp- loyer has control over the employee. Work performed off the employer's premises does indicate some freedom from control; however, it does not in itself mean the worker is not an employee.
ORDER OR SEQUENCE OF SERVICES: An employee generally performs services in the order or sequence set by an employer. This shows that the employee is subject to direc- tion and control of the employer.
REPORTS: An employee submits oral and written reports to an employer. This shows that the employee must account to the emp- loyer for his or her actions.
PAYMENTS: An employee is usually paid by the hour, week, or month. An independent contractor is paid periodically (usually a
percent of the total payment) by the job or on a straight commission.
EXPENSES: An employee's business and/or travel expenses are paid by an employer.
This shows that the employer is in a position to control expenses and therefore the emp- loyee is subject to regulations and control.
TOOLS AND MATERIALS: An employee is furnished significant tools, materials, and other equipment by an employer. An indepen- dent contractor usually provides his own tools, materials, etc.
INVESTMENT: An employee is usually fur- nished the necessary facilities. An inde- pendent contractor has a significant invest- ment in the facilities he or she uses in per- forming services for someone else.
PROFIT OR LOSS: An employee performs the services for an agreed upon wage and is not in a position to realize a profit or suffer a loss as a result of his services. An independent contractor can make a profit or suffer loss. Profit or loss implies the
use of capital by the individual in an indep- endent business of his own.
WORKS FOR MORE THAN ONE PERSON OR FIRM: An employee usually works for one organiza- tion. However, a person may work for a num- ber of people or organizations and still be an employee of one or all of them. An indep- endent contractor provides his or her ser- vices to two or more unrelated persons or firms at the same time.
OFFERS SERVICES TO GENERAL PUBLIC: An independent contractor makes his or her ser- vices available to the general public. This can be done in a number of ways: Having his/her own office and assistants, hanging out a "shingle", holding business licenses, having listings in business directories and telephone directories, and advertising in newspapers, trade journals, etc.
RIGHT TO TERMINATE EMPLOYMENT: An employee can be fired by an employer. An independent contractor cannot be fired so long as he or she produces a result that meets the specifications of the contract. An independent contractor can be terminated but usually he will be entitled to damages for expenses incurred, lost profit, etc.
RIGHT TO QUIT: An employee can quit his or her job at any time without incurring
liability. An independent contractor usually agrees to complete a specific job and is res- ponsible for its satisfactory completion, or is legally obligated to make good for failure to complete it.
Using the foregoing factors as guidelines, it is clear that petitioner was not, within the meaning of the rule, subject to the College's control and direction "with respect not only to what shall be done but to how it shall be done." Rule 60S-6.001(33), Florida Administrative Code.
When he became a consultant, Dr. Tamburello was not subject to instructions about when, where or how to work, and did not perform tasks for which the College had trained him. The special projects he took on were not so much "integrated into the business operations," as peripheral: public relations, fund raising and long term planning are all activities for which enterprises commonly call on consultants. Although petitioner had a continuing relationship with the College, he did not work set hours, did most of his work off the premises, and had complete control over the order or sequence of services he performed.
In short, petitioner was an independent contractor during the term of the 1987-1988 consulting contract with the College. Since petitioner worked as an independent contractor under the contract and did not work as an employee during the twelve months following his retirement, Section 121.091(9), Florida Statutes (1991), does not effect a forfeiture of his retirement benefits.
It is, therefore, unnecessary to reach petitioner's contentions that respondent is estopped or barred by a statute of limitations from recovering retirement benefits paid to petitioner; that forfeiture of retirement benefits which exceed what petitioner was paid as a consultant would amount to imposition of an excessive fine in violation of Article I, Section 17, of the Florida Constitution; that the 1985 amendment to Section 121.091(9), Florida Statutes, cannot constitutionally apply to petitioner, whose right to retirement benefits, vested before the amendment took effect; or that the statutory scheme denies petitioner equal protection of the laws in violation of both the Florida and federal constitutions.
It is, accordingly, RECOMMENDED:
That the Department of Management Services, Division of Retirement, enter a final order formally abandoning any claim to the retirement payments it made to petitioner during the period from August 1, 1987 through June 30, 1988.
DONE AND ENTERED this 13th day of August, 1993, in Tallahassee, Florida.
ROBERT T. BENTON
Hearing Officer
Division of Administrative Hearings The Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32399-1550
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 13th day of August, 1993.
APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-7366
Petitioner's proposed findings of fact Nos. 1 through 21 and 25 have been adopted, in substance, insofar as material.
Petitioner's proposed findings of fact Nos. 22, 23, 24 and 26 are properly proposed conclusions of law.
Respondent's proposed findings of fact Nos. 6, 7, 8 and 14 have been adopted, in substance, insofar as material.
With respect to respondent's proposed finding of fact No. 1, Dr. Tamburello supervised public relations and computer operations when he worked as Director of Administrative Services.
With respect to respondent's proposed finding of fact No. 2, while his schedule as Assistant to the President varied from day to day, he met with the President every morning.
With respect to respondent's proposed finding of fact No. 3, the contract was dated July 21, 1987.
Respondent's proposed finding of fact No. 4 pertains to subordinate and immaterial matters.
With respect to respondent's proposed finding of fact No. 5, Dr. Hartsell did not want to retain Dr. Tamburello as Assistant to the President.
With respect to respondent's proposed finding of fact No. 9, the 1991-1992 contract was between the College and E&T Management Service.
With respect to respondent's proposed finding of fact No. 10, there was some overlap.
With respect to respondent's proposed finding of fact No. 11, making introductions is not necessarily the function of an employee.
With respect to respondent's proposed finding of fact No. 12, Dr.
Tamburello did not meet with Dr. Smith on a continuous basis.
With respect to respondent's proposed finding of fact No. 13, the name of the company was E&T Management Service.
COPIES FURNISHED:
Susan B. Kirkland, General Counsel Department of Management Services 2737 Centerview Drive
Tallahassee, Florida 32399-0950
William H. Lindner, Secretary Department of Management Services 2737 Centerview Drive
Tallahassee, Florida 32399-0950
M. J. Menge, Esquire
Shell, Fleming, Davis & Menge Post Office Box 1831
226 Palafox Place Pensacola, Florida 32501
Stanley M. Danek, Esquire Division of Retirement
Cedars Executive Center-Building C 2639 North Monroe Street Tallahassee, Florida 32399
NOTICE OF RIGHT TO SUBMIT EXCEPTIONS
All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.
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AGENCY FINAL ORDER
=================================================================
STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS DIVISION OF RETIREMENT
GASPARE B. TAMBURELLO,
Petitioner,
vs. Case No. DR 92-23
(DOAH Case No. 92-7366)
DEPARTMENT OF MANAGEMENT SERVICES, DIVISION OF RETIREMENT,
Respondent.
/
FINAL ORDER
This matter came up for hearing in Pensacola, Florida, on June 7, 1993, before Robert T. Benton, II, a Hearing Officer with the Division of Administrative Hearings. Thereafter, the Parties timely submitted proposed findings of fact and conclusions of law. A Recommended Order was issued on January 22, 1992, and a copy of it is attached hereto, incorporated by reference and made a part of this Final Order as an exhibit. The transcript of the hearing was ordered and considered in the determination of the facts of this Final Order. Having considered the Findings of Fact in the Recommended Order, all matters of record and the transcript of the final hearing, the Division of Retirement hereby adopts in part and rejects in part the Findings of Fact of the Recommended Order as follows: The Parties are as follows:
APPEARANCES
For Petitioner: M. J. Menge
Attorney at Law
Post Office Box 1831 Pensacola, Florida 32598
For Respondent: Stanley M. Danek
Division Attorney Division of Retirement Cedars Executive Center
2639 North Monroe Street, Building C Tallahassee, Florida 32399
PRELIMINARY STATEMENT
At issue in this proceeding is whether the Petitioner, Gaspare B. Tamburello, was an independent contractor or an employee of Pensacola Junior College (hereinafter, PJC or the College) for the period of August 1, 1987, through June 30, 1988.
According to the records of the Division, the Petitioner retired from the Florida Retirement System (hereinafter, FRS) on July 1, 1987, and was reemployed by PJC as an employee and not as an independent contractor for the period of August 1, 1987, to and including June 30, 1988, a period during the first 12 months after his retirement. By letter dated November 4, 1992, the Director of the Division of the Division of Retirement (hereinafter, the Division) notified Mr. Tamburello that he was in violation of Section 121.091(9), Florida Statutes, for the above period of time (Respondent's Exhibit No. 3).
Subsequent to the above agency action, a request for hearing was made by the Petitioner (Respondent's Exhibit No. 4). The matter was then forwarded to the Division of Administrative Hearings for assignment of a Hearing Officer and the scheduling of the final hearing.
ISSUE TO BE DETERMINED IN THIS PROCEEDING
The issue to be determined in this proceeding was whether or not Mr.
Tamburello was an independent contractor or an employee of PJC for the time from August 1, 1987, to and including June 30, 1988, the period during the first 12 months after his retirement.
FINDINGS OF FACT
Adopted.
Adopted.
Adopted.
Adopted, with the additional Finding of Fact that in the letter of January 26, 1987 (Respondent's Exhibit No. 7), Dr. Tamburello stated that he hoped "that my experience and background would provide an opportunity to continue my affiliation with PJC as a part-time consultant in the development of community relations and senior citizen programs". Further, the contract used by the College and Dr. Tamburello, termed an ??honorarium contract", was a standard contract used by the College with its instructional staff and contained numerous
provisions that were inapplicable to Dr. Tamburello either as an employee or an independent contractor (see Item No. 4, for example). Thus, since the contract is facially inaccurate to the instant situation, it is of questionable value in determining the true status of Dr. Tamburello.
Adopted, with the additional Finding of Fact that Dr. Tamburello helped train Mr. Armstrong in the duties of the Assistant to the President by taking him around to the various community groups and leaders. Dr. Tamburello included the time spent training Mr. Armstrong in the time billed to the College (Respondent's Exhibit No. 10). It was evident that this was part of his new duties since he was compensated for his efforts; otherwise, he would have done them on his own time and not received compensation.
Adopted, in part, with the limitation that the contract is facially inaccurate and therefore not useful in assisting the Division in the determination of Dr. Tamburello's correct status with the College. Dr. Tamburello testified that Dr. Hartsell wanted him to continue with the college. He and Dr. Hartsell then began to discuss how the College could continue to make use of Dr. Tamburello's experience and abilities in a consultant status after his retirement (testimony of Dr. Tamburello and Dr. Hartsell). The areas they discussed were among those contained in the memorandum of May 21, 1987. As Dr. Hartsell stated, he wanted to use Dr. Tamburello "where he had the special talents" and he looked to Dr. Tamburello's expertise for that (testimony of Dr. Hartsell). It is clear that Dr. Hartsell wanted to retain Dr. Tamburello and did not want anyone else for the job. The attempt to enter into a "consulting contract" was an attempt to keep Dr. Tamburello in a productive capacity, and yet, let him retire.
On May 21, 1987, Dr. Tamburello gave Dr. Hartsell a memorandum stating the various areas that he believed he could continue to serve the College. He stated that "(y)ou asked that I identify areas in which I can serve under the proposed consulting contract. The following activities could be assigned under the contract as needed." (Id). The memorandum then stated several areas proposed by Dr. Tamburello. These generally included community relations, Navy relations, the PJC Senior's Club, veteran's affairs, continuing education, international education and special studies and projects as requested. (Id).
In the letter of June 23, 1987, Dr. Hartsell stated: "I looked forward to continuing to work with
you in your new role of consultant to the college in community affairs, knowing that we will see you less, but placing no smaller value on your service to the students, faculty and staff of Pensacola Junior College." (Respondent's Exhibit No. 8)
Further, while it was true that Dr. Tamburello reported income from the College on Schedule C of his tax form, that was done because of the pay arrangement made by PJC and is not determinative of the employment relationship vel non between the parties. The Finding off Fact No. 6 in the Recommended Order that he did not fill a position at the College is rejected as not being based on the competent, substantial evidence in the record. The Finding of Fact that Dr. Tamburello was paid from the accounts payable account of the College and that no withholding taxes or Social Security were withheld from his compensation is immaterial, and, therefore, rejected. The Finding of Fact as to
the reimbursement of expenses is immaterial because Dr. Tamburello had made the decision that he would absorb the cost of transportation as part of his compensation (T-146).
Adopted, with the exception that the College did provide secretarial services as necessary (T-127). They just weren't necessary very often because Dr. Tamburello made most, if not all, of his reports verbally.
Rejected. There is no evidence that the Parties even discussed whether or not Dr. Tamburello could hire assistants. From the evidence, it is doubtful that he could have done so because the basis of the relationship after retirement was his military background and the contracts he had developed in the
18 years spent with PJC. No assistant could have brought such experience and knowledge to the job. The Finding of Fact that Nova University paid Dr. Tamburello certain amounts in 1987 and 1988 should also include the fact that the federal Internal Revenue Service found Dr. Tamburello to be an employee of Nova and not an independent contractor as he had claimed to be in the federal tax returns. IRS, however, did not make its decision retroactive (T-131). As to the Finding of Fact that he had formed his company, E & T Management Service Co., prior to 1987, the arrangement between Dr. Tamburello and PJC was clearly for his services only. If the Parties had wanted to, they could have made the contract between PJC and E & T Management Service since the College was aware of the existence of that company. It was the decision of Dr. Spivey to make the contract with Dr. Tamburello personally (T-157).
Adopted, with the additional Finding of Fact that Dr. Tamburello also did a number of duties under the contract that he had done while the Assistant to the President (T-140-144).
Adopted.
Rejected, as to the first two sentences. The competent, substantial evidence shows that the College had the right to control the activities and work performed by Dr. Tamburello. The contract between the Parties states this to be the case. As it evolved, the College exerted little control over Dr. Tamburello because it was not necessary. Even when he was the Assistant to the President, he had no regular schedule and represented the President when he was out of town (testimony of Dr. Tamburello). As to the location of the office, Dr. Tamburello did have an office at home but had virtually no equipment in it. He could have worked at the College if he needed to so the location of the office, in this case, is not material.
Adopted.
Adopted. Dr. Tamburello's experience as a naval officer, his doctoral thesis, and his civic activities prepared him for his work at the College when he was an employee. This experience, as well as the experience while employed at the College for 18 years, prepared him for his work efforts after retirement. Dr. Tamburello was reemployed after his retirement because of the above experiences, and they cannot be considered in isolation from the total employment picture. Had Dr. Tamburello not had the above experiences, not worked for 18 years for the College, not built up a network of community friends and supporters, he would not have been rehired by the College to do the special activities that he and Dr. Hartsell had discussed.
Rejected, as not being based on the competent, substantial evidence in the record. This is further discussed in the Conclusions of Law because it is a mixed question of fact and law.
Adopted, with the additional Finding of Fact that the Auditor General, in his audit of the College, questioned the status of Dr. Tamburello "as either an independent contractor or employee for services performed under the consultant contract" (Respondent's Exhibit No. 2, page 31). As a result, the College requested clarification of the status of Dr. Tamburello for the period alleged violation, August 1, 1987, to and including June 30, 1988.
CONCLUSIONS OF LAW
The first issue to be considered concerns which party to this type of proceeding, the petitioner or the respondent, has the burden of proof of going forward with the initial evidence. At the hearing, the Petitioner attempted to identify this proceeding as a "forfeiture" proceeding because Dr. Tamburello would have to repay the amount of his retirement benefits received from August, 1987, to June 30, 1988, to the Retirement Trust Fund if it is found that he violated the reemployment prohibitions. It is clear, however, that the initial issue in this case is whether or not Petitioner was an employee or an independent contractor for the above period. Once that is determined, then the payment (or not) of the retirement benefits must follow.
Such a position would be correct if the Division had known, or been placed on notice, about the reemployment of Dr. Tamburello beforehand and had either (1) taken no action, or (2) given its tacit approval by its silence. Neither of these two events occurred. Rather, Dr. Tamburello and the College entered into the first "contract" without prior contact with the Division for its advice, review and/or consent. Under these circumstances, the burden of proof should be on them to justify their actions. To hold otherwise would reward Petitioners for their failure to seek proper review by the Division.
Some analogous situations exist in other benefits granted as part of the Florida Retirement System Act. For example, in cases in which the Division has already granted disability retirement to a member and thereafter attempts to review that award of benefits with the purpose of suspending or revoking the benefit, an appellate court has stated that the burden of proof is upon the Division to prove that the member is no longer disabled. (Amico vs. Division of Retirement, Department Administration, 352, So.2d 556 (Fla. 1st DCA 1977). The Division uses the same reasoning in conducting "re-examinations" of special risk status, which is an action to remove persons from special risk status when they had been granted that status previously. These include law enforcement officers, firemen and correctional officers who may receive special risk membership under Section 121.0515, Florida Statutes. At the administrative hearing before the State Retirement Commission, the Division goes forward with burden of proof (Section 121.23, Florida Statutes) because it is trying to remove a benefit which it had once reviewed and granted. It is clear in the case at bar, however, that the primary issue is not a review of the Division's prior actions (there was none), but the issue of proper classification of Dr. Tamburello as an employee or an independent contractor. The issue then was Dr. Tamburello an employee or an independent contractor for the period in question. In the case at bar, the Division is not attempting to change anything since nothing has been legally determined in or by a jurisdictionally competent legal authority.
The determination as to whether or not Dr. Tamburello was an employee or an independent contractor is one that he must show by the preponderance of the evidence at the hearing. He has the burden of proof to assert the affirmative of the above issue before the administrative tribunal. Balino, et al., vs. Department of Health and Rehabilitative Services, 348 So.2d 349 (Fla. 1st DCA 1977); Grady vs. Department of Professional Regulation, Board of Cosmetology, 402 So.2d 438 (Fla. 3rd DCA 1981); Fla. East Coast Railway Co. vs. King, 158 So.2d 523 (Fla. 1963).
Therefore, the burden of proof in these proceedings should be upon the petitioners. In the case at bar, the Division did proceed with presenting its case first upon direction and showed that Dr. Tamburello was an employee and not an independent contractor.
In his attempt to direct the burden of proof upon the Division, Petitioner further attempts to characterize the proceeding as a "forfeiture" proceeding. Of course, the word "forfeiture" does not appear in those sections of the law dealing with return to employment within twelve (12) months after retirement, infra, but, rather the law speaks in terms of "suspension" and "reimbursement" of benefits. The only reference to forfeiture in Chapter 121, Florida Statutes, is in Section 121.091(5)(f)(g) and (h), Florida Statutes, under which the right to retirement benefits will be forfeited for the admission of, or criminal conviction of, certain specified acts against the person's employing agency. Forfeiture has never been used to describe the reimbursement of benefits in cases such as Dr. Tamburello's because the initial determination concerns the person's employment status. Forfeiture is normally appropriate where there has been a violation of a criminal law, something not applicable in this case.
At the time that his reemployment occurred, the law dealing with the limitation on employment after retirement was contained in Section 121.091(9)(b)1., Florida Statutes (1987), which provided in part as follows:
"Any person who is retired under this chapter, except under the disability retirement provisions of subsection (4), may be reemployed by any private or public employer after retirement and receive retirement benefits and compensation from his employer without any limitations, except that a person may not receive both a salary from reemployment with any agency participating in the Florida Retirement System and retirement benefits under this chapter for a period of 12 months immediately subsequent to the date of retirement."
Further, if the above section was violated, Section 121.091(9)(b)3., Florida Statutes, (1987) provided in pertinent part:
"Any retirement benefits received while reemployed during this reemployment limitation period shall be repaid to the retirement trust fund, and retirement benefits shall remain suspended until such repayment has been made. Benefits suspended beyond the reemployment limitation shall apply toward repayment of
benefits received in violation of the reemployment limitation."
Section 121.091(9)(b)2., does provide an exception for members who are retired from community colleges and who are hired as adjunct faculty members and states in pertinent part as follows:
"A retired member may be reemployed as an adjunct instructor for no more than 780 hours during the first 12 months of his retirement."
Even though the "honorarium contract" is one normally used for adjunct instructors at the College, based upon the facts presented in this case, it is clear that Dr. Tamburello was reemployed for special duties for the College and was not reemployed as an adjunct instructor. Therefore, he does not fall within the above statutory exception.
Pursuant to the statutory authority, the Division of Retirement promulgated Rule 22B-6.01(15), F.A.C., (1987) "Consultant or Other Professional Person" to further clarify who was an independent contractor. The rule contains the definition of a consultant or professional person who would be exempt from the reemployment provisions of the law and stated as follows:
"Means an individual who: agrees to provide certain services; works according to his own methods; is not subject to the control of his employer, except as to the results of his work; and does not enjoy the fringe benefits offered by the employer. A consultant or other professional person usually: is compensated from another salaries and wages account; does not earn annual or sick leave; and may frequently do a majority of his work in his own office rather than on the employer's premises." (further citation omitted)
PJC and Dr. Tamburello base their claim that he is an independent contractor in part upon the contract entered into between them on July 21, 1987, which states that Dr. Tamburello is "acting as an independent contractor in entering into this agreement, and that while performing services under this contract, he/she will not be regarded as an employee of the College for purposes of workmen's compensation or any other purpose." (Respondent's Exhibit No. 13). As a matter of law, the status of any employee, including Dr. Tamburello, may be established by law, but not by parties to a contract; however, the status of an independent contractor or an employee depends not upon the statements of the parties alone but upon all of the circumstances of their dealings with one another. Cantor v. Cochran, 184 So.2d 173 (Fla. 1966)
The effect of such a contract, if allowed to stand as defining the relationship between the Parties, would oust the power and authority of the Division to properly administer the Retirement System. Obviously, such a result would be contrary to the provisions of Chapter 121, Florida Statutes. All contracts or employment relationship between parties governed by FRS are subject to ultimate review by the Division for compliance with the retirement law. If parties to such contracts do not obtain approval or clearance of the "contract"
before it is executed, then they should be able to defend their actions to the Division, or if necessary, in an administrative hearing.
The evidence shows that Dr. Tamburello had a company, E & T Management Services, that he used to provide services to various individuals. While the Division did not dispute the existence of that company, it is obvious that the contract under consideration (Respondent's Exhibit No. 13), was between Dr. Tamburello personally and PJC and not between his company and PJC. There was testimony from a representative of PJC that under its procedures, it had to enter into a contract with Dr. Tamburello personally and not with his company. The basis for that policy was not clear in the record, but it merely reinforces the agency decision that the contract was for personal services between the College and Dr. Tamburello and not a contract with his company.
PJC selected the Petitioner for reemployment based upon his long years of experience gained while working with the College. Dr. Tamburello had been employed by PJC for almost eighteen years and had been the Assistant to the President since 1981. During that time he had developed close relations with the local civilian and Navy communities. His position description stated that among his duties were to serve "as the college's community liaison representative to develop and maintain optimum relationships between the college and the community", supervise "the College Public Relations function" and perform "related duties as required or deemed appropriate to the accomplishment of the responsibilities and functions of the position." (Respondent's Exhibit No. 5).
As in any working relationship, the employee may be involved in many different projects. Even if a person is hired for certain specified projects, those projects change over time so that over a period of a year, the employee may have completed some projects and begun work on a number of others. What remains constant, however, is that he continues to use his talents and efforts for the good of the employer and to further the interests of the employer. An independent contractor, however, does not have the interests of the agency as his primary concern, except as to the final results of the job, but rather has the interests of his business or profession as his primary concern.
As to the duties performed after retirement, the argument of PJC and Dr. Tamburello was that he was to work on specific projects such as the PJC Future Fund, the Homeporting Ships Educational Program and a community needs assessment program (Respondent's Exhibit No. 9). The reason that he was chosen to do those tasks was the familiarity with the Navy, the Pensacola community and the College that he had obtained while employed, at least in part, while employed by PJC. In fact, Dr. Hartsell and Dr. Tamburello had discussed the possibility of continuing the arrangement between PJC and Dr. Tamburello after retirement, and Dr. Tamburello had given Dr. Hartsell a proposed list of job duties on May 21, 1987, a date prior to retirement.
The Division has extensive experience in making these determinations based upon its administration of the law and close working relationship with the federal Internal Revenue Service and its criteria. In fact, the 20 criteria used by the Division were adopted from the IRS. In situations where a person retires from an agency and is reemployed within the 12-month-limitation period, the Division looks much closer at those arrangements to determine the intent of the parties. It has been the experience of the Division in a great many instances that the parties have entered into a prior agreement to return the person to employment soon after "retirement". This possibility is so real that
the Legislature changed the definition of "termination" in 1988 (see Chapter 88- 382, Laws of Florida), so that law now states in Section 121.021(29), Florida Statutes, in part as follows:
"Termination occurs when a member ceases all employment relationships with employers under this system, as defined in subsection (10), but in the event a member should be employed by any such employer within the next calendar month, termination shall be deemed not to have occurred." (See Rule 60S-6.001(60) and 4.009(5), Florida Administrative Code)
In cases in which a retired member returns to employment with the same agency as he retired from, it is much more likely that the arrangement is merely a continuation of the prior employer/employee relationship rather than an independent contractor arrangement. Section 121.091(9)(b)(1), Florida Statutes, above, containing the 12-month-reemployment-limitation rule, was designed to prevent just such a "friendly" relationship between agencies and their retirees. As was stated by the hearing officer in his Recommended Order in the case of Nunn, et al., vs. Department of Administration, Division of Retirement, DOAH Case Nos. 90-8016, 90-8016 and 90-8017 (officially noticed in case at bar), a similar case:
"The opportunity to circumvent the law is particularly seductive where, as here, the employer needs the services of a recently retired employee. Scepticism by the agency (Division of Retirement) in such circumstances is appropriate." (Recommended Order issued January 15, 1992; Final Order issued April 7, 1992; case is currently on appeal to the 1st District Court of Appeal)
It is clear that Dr. Hartsell wanted Dr. Tamburello to continue performing services for PJC because he was a long time and valued employee who had the skills the College needed and wanted. While his duties were narrower and more specific after retirement than those before retirement when he was the Assistant to the President, those new duties were essentially the same functions and duties performed prior to his retirement. Further, the new duties were part of the regular business of the College and some of the programs Dr. Tamburello worked on have been incorporated as part of the course offerings of the College. Although PJC and Dr. Tamburello contend he was an independent contractor, he did not perform the same work for any other junior college and did not hold himself out to the general public to perform such duties. He did not advertise his services other than have a business card (Petitioner's Exhibit No. 7). While he had a business, his efforts for the College were delivered personally and not by the business. He was not incorporated and did not have a sales tax number or a federal I.D. number.
Dr. Tamburello argued that the common law rules laying out the distinctions between independent contractors and employees should govern. Under those rules, the courts have held that the most significant indicia of an independent contractor status is the degree of control which a putative employer exercises over the person such as the right to direct what shall be done and how and when it shall be done. LaGrande vs. B.L. Services, Inc., 432 So.2d 1364 (Fla. 1st DCA 1983).
In the Consulting Schedule Record (Respondent's Exhibit No. 10), prepared by Dr. Tamburello for pay and time accounting purposes, he indicated that he did many tasks in his job. For example, the Consulting Schedule Record stated that he had done the following jobs for the period of August 1, 1987, to June 30, 1988:
Wrote letters for Dr. Hartsell on 8 occasions;
Wrote or edited a speech or speeches for Dr. Hartsell on 2 occasions;
Prepared a report for Dr. Hartsell or the Board of Trustees on 5 occasions;
Made arrangements for his successor to meet the community leaders on 9 occasions;
Chaired a meeting of a College committee on 1 occasion;
Acted as the advisor to the PJC Seniors Club on 7 occasions;
Attended functions of PJC Seniors Club on 4 occasions;
Attended meetings or functions at the request of Dr. Hartsell on 11 occasions;
Attended functions for Dr. Hartsell on 2 occasions; and
Attended functions for PJC on 3 occasions.
Of the 101 tasks or duties performed and described on the Consulting Schedule Record, 52 are listed in the above 10 items. Many of these items are either identical or very similar to the duties Dr. Tamburello did when he was the Assistant to the President and all are functions of an employee. For example, he chaired the meeting of a college committee, acted as the advisor to a college group, attended functions for either Dr. Hartsell or PJC. None of the above tasks that he did are the types of tasks normally done by an independent contractor.
Dr. Hartsell testified that those events when he told Dr. Tamburello to attend some function were considerably different from similar situations that occurred when Dr. Tamburello was an employee. On these occasions, he "directed" Dr. Tamburello to attend functions, while after retirement, he would "request" that Dr. Tamburello attend similar functions. However, the Consulting Schedule Record (Respondent's Exhibit No. 10) appears to contradict that testimony and would lead one to believe that as a matter of fact the activities and the tasks performed by Dr. Tamburello were directed to some extent by Dr. Hartsell. However, it is most evident that Dr. Tamburello may have been "requested" to perform certain functions; Dr. Hartsell could have and did tell him to go to certain functions and direct many, if not most of his activities. The fact that Dr. Hartsell did not do so is not material because the important criteria is that he had the right to do so. In addition, the contract stated that the services contained in the attached letter would "be performed under the direction of Dr. Horace E. Hartsell and Dr. Elizabeth Smith, Dean", further indicating that direction was to be given to Dr. Tamburello. Given the background and training of Dr. Tamburello, it probably was not necessary for him to be given very many direct instructions. Therefore, this area tends to show that Dr. Tamburello was an employee and not an independent contractor.
Dr. Tamburello testified that he did very little work at the College and did not have an office or secretarial support which was an indicator that he
was an independent contractor. However, the contract between PJC and Dr. Tamburello permits him "to perform services described (in the contract) in a location designated by the College or the President as authorized by the District Board of Trustees." (Respondent's Exhibit No. 13). Therefore, he could perform work whenever and wherever needed and still be considered an employee of the College.
The work performed by him was performed at a location agreeable to the College. In each case the method of payment was based on the month or two- month-period and not by the job performed. All of these factors indicate an employer-employee relationship and not an independent contractor relationship as contended by PJC and Dr. Tamburello. In addition, several other factors were shown by the evidence and considered by the Division. Dr. Tamburello reported to Dr. Hartsell both after reemployment as well as before retirement. The rate of pay in the contract was $20 per hour, a rate slightly in excess of the hourly rate paid to him prior to his retirement. He was not hired on a "per job" basis as would be normal for an independent contractor such as an air conditioner repairman or an automobile mechanic but was hired on a continuing basis to pursue the interests of the College and not his own interests. Dr. Tamburello was acting as an extension of the College for all intents and purposes and as their agent. Nowhere in any of the evidence or testimony did the College or Dr. Tamburello disclaim this apparent relationship. The contract between the College and Dr. Tamburello did not provide liability for failure to perform. In Cantor v. Cochran, 184 So.2d 173, 174, (Fla. 1966), the court stated:
"But the most telling factor establishing control was that petitioners fired the claimant without giving rise to a cause of action for breach of contract. As was said in Goldstein
v. Gray Decorators, Inc., Fla. 1964, 166 So.2d 438, and Lindsey v. Willis, Fla.App. 1958, 101 So.2d 422: The power of fire is the power of control."
In this case, PJC clearly maintained the right to discharge Dr. Tamburello without liability; thus, it retained the right of control over him.
As part of the information provided to the Division, the College completed an "Employment Relationship Questionnaire" on Dr. Tamburello for the June, 1987, to June, 1989, period of time (Respondent's Exhibit No. 11) which stated that the hours of work, his time records and the place of the work was selected by the "worker" in cooperation with the agency. Further, in Item #8, the Questionnaire stated that "it was agreed or understood that the worker would perform the services personally". In AGO 62-120, the Attorney General dealt with the rules for determining whether or not a person was an employee or an independent contractor. He stated and quoted from 56 C.J.S., Sect 3(2), that:
"Among the factors to be considered are whether the contractor is carrying on an independent business; whether the work is part of the employer'S general business; the nature and extent of the work; the skill required; the term and duration of the relationship; the right to assign the performance of the work to another; . . . .
While the Petitioner's witness stated that Dr. Tamburello could have hired other persons to do the work, the Questionnaire stated to the contrary. Further, the discussions between Dr. Hartsell and Dr. Tamburello make it clear that personal services were desired. In the letter of June 23, 1987, Dr. Hartsell stated:
"I look forward to continuing to work with you in your new role of consultant to the college in community affairs, knowing that we will see you less, but placing no smaller value on your service to the students, faculty and staff of Pensacola Junior College." (Respondent's Exhibit No. 8)
Dr. Rand Spiwak, the Vice-President for Business Affairs, testified that the "honorarium contract" was the only one used but agreed that other types of contracts had been used prior to that by the College. An honorarium contract is not that type of contract that would normally be used in this type of situation. Honorarium is defined as a "payment usually for services on which custom or propriety forbids a price to be set." Webster's New Collegiate Dictionary, 1975 Ed., page 549. Dr. Spiwak was asked if he or anyone else with PJC had called the Division of Retirement to discuss the proposed consulting contract with Dr. Tamburello. He answered in effect that he did not know, but that there was no record of such a call. The Division is always available to answer such inquiries, but there is no record of such an inquiry having been received by the Division. On a question of such importance to Dr. Tamburello, it was obvious that such a call should have been made.
The Petitioner relies on the case of Davis vs. Department of Administration, Division of Retirement, 585 So.2d 421 (Fla. 1st DCA 1991), to support his case. In that case, Davis retired from one school board and went to work with another school board. While this is a critical factual difference between the two cases, there are other important differences. In Davis, the Court noted that the hearing officer had stated that Davis could work at a location of his choice while in the case at bar, the location of the work was agreed to between the parties. Further, Davis was making an attempt to obtain the business of another school board while he was an independent contractor; Dr. Tamburello testified that he did not solicit any business from another agency or community college. Thirdly, there was no evidence in Davis to demonstrate that the contractual arrangement was collusive between Davis and the school board. However, in the case at bar, the two Parties had negotiated for several months about how to keep Dr. Tamburello with the College. Without question, Dr. Hartsell wanted him to continue with the College. Dr. Tamburello and Dr. Hartsell discussed how the College could continue to make use of Dr. Tamburello's experience and abilities in a consultant status after his retirement. Dr. Hartsell stated that he wanted to use Dr. Tamburello "where he had the special talents", and he looked to Dr. Tamburello's expertise for that purpose. There can be no question that Dr. Hartsell wanted to retain Dr. Tamburello and did not want anyone else for the consultant job. To argue at this late date that Dr. Tamburello could have used other persons to do the work is to ignore the testimony and the facts that existed in early 1987. The attempt to enter into a "consulting contract" was an attempt to keep Dr. Tamburello in a productive capacity and yet let him retire. This arrangement was friendly between the parties and takes this case out of the preview of the Davis case thereby leading to the oppose result.
OTHER LEGAL ISSUES RAISED BY PETITIONER
In his Petition for Formal Hearing (Respondent's Exhibit No. 4), Petitioner raises other legal issues in addition to those discussed above. These issues were mentioned but not determined in the Recommended Order.
The first of these issues is that the Division is estopped from requiring Petitioner to repay the Division the retirement benefits for the August 1, 1987, to June 30, 1988, period. The issue, as presented by Petitioner, appears to be whether or not the Division made any representations to Dr. Tamburello concerning his employment status with PJC.
Equitable estoppel may be used against the State only in exceptional circumstances. In Tri-State Systems, Inc., vs. Department of Transportation,
500 So.2d 212 (Fla 1st DCA 1986), the Court stated that certain elements must be present for estoppel to apply; these elements are:
A representation as to a material fact that is contrary to a later-asserted position;
reliance on that representation;
a change in position detrimental to the party claiming estoppel, caused by the representation and reliance thereon.
There is no evidence in the record that the Division was contacted by either Dr. Tamburello or the College about this matter until the letter from the College which was prompted by the Audit Report of the State Auditor General (Respondent's Exhibit No. 2). Therefore, the Division could not have made any representations to either Dr. Tamburello or the College and there could not be any reliance on their parts. If any mistake was made, it was made when they did not contact the Division to obtain its opinion before entering into the contract. The issue of estoppel is not applicable in this case because of the failure to show that the Division made any representations to Dr. Tamburello or the College. This argument of Petitioner is without legal merit.
The second additional legal issue raised by Petitioner is that the doctrine of laches or the statute of limitation should apply. The doctrine of laches is defined as negligence or the omission to assert a right seasonably or the unexcused delay in asserting a right in a timely manner (35 Fla. Jur2d, Limitations and Laches, Sect 83). Since administrative actions are actions at law, laches does not apply. Further, after the Audit by the Auditor General, the College was advised to contact the Division. It did so, and this proceeding was then commenced. The Division was not negligent nor did it fail to timely assert any right it had against Dr. Tamburello.
As to the limitations argument, Petitioner asserts that the Division cannot now proceed because it failed to take action within four years of the original period of the contract which ended on June 30, 1988. Chapter 121, Florida Statutes, does not contain any limitation period. Section 95.11(3)(n), Florida Statutes, prevents suit after four (4) years on an "action for a statutory penalty or forfeiture". As explained supra, this is not a forfeiture action but an action to determine Dr. Tamburello's employment status with the College. Therefore, Section 95.11(3)(n), Florida Statutes, does not apply. The First District Court of Appeals in Davis vs. Department of Administration, Division of Retirement, 585 So.2d 421 (Fla. 1st DCA 1991) found that the identical argument presented therein was without merit (see footnote #1 to the opinion). Therefore, this argument of Petitioner is without legal merit.
Lastly, Petitioner argues that Section 121.091(9), Florida Statutes, and its resulting rules are unconstitutional. This argument centers around the existence of two exceptions contained within this section which permit the reemployment of retirees within the 12-month-period after retirement. First, Section 121.091(9)(b)1, Florida Statutes, permits a district school board to "reemploy a retired member as a substitute teacher on a noncontractual basis after he has been retired for 1 calendar month" with the period of time to be no more than 780 hours within the first twelve months of retirement. Second, Section 121.091(9)(b)1, Florida Statutes, permits a community college to "reemploy a retired member as an adjunct instructor, an instructor who is noncontractual and part-time, after he has been retired for 1 calendar month" with the period of time to be no more than 780 hours during the first twelve month of retirement. The law, therefore, clearly states that only substitute teachers or adjunct instructors may be employed; no other exceptions are allowed. Given the demands of our educational system and the need for qualified teachers in the classroom, the law provides some relief to school boards. The classification established by the Legislature provides for the advancement of a legitimate objective, education, and is founded on a reasonable basis. Caloosa Property Owners Assoc., vs. Palm Beach County Board of County Commissioners, 429 So.2d 1260 (Fla. 1st DCA 1983). Further, the Legislature has not violated some fundamental right or adversely affected some suspect class so as to impose a greater standard of review on Section 121.091(9)(b)1, Florida Statutes. The First District Court of Appeals in Davis vs. Department of Administration, Division of Retirement, 585 So.2d 421 (Fla. 1st DCA 1991) said that the identical argument presented therein was without merit (see footnote #1 to the opinion). Therefore, argument of Petitioner is without legal merit.
Based upon the foregoing, it can only be concluded that the relationship of Dr. Tamburello with Pensacola Junior College for the period of August 1, 1987, to and including June 30, 1988, is one of an employee and employer. Therefore, Dr. Tamburello is subject to the reemployment limitations set forth in Chapter 121, Florida Statutes.
It is, therefore,
ORDERED and DIRECTED that Gaspare B. Tamburello was reemployed by Pensacola Junior College within twelve months after his retirement from the Florida Retirement System for the period of August 1, 1987, to and including June 30, 1988, in violation of the reemployment limitations of Chapter 121, Florida Statutes. Therefore, any retirement benefits received by him during the above period of time shall be repaid to the Florida Retirement System Trust Fund, and retirement benefits shall remain suspended until benefits have been repaid.
DONE AND ORDERED this 12th day of November 1993, at Tallahassee, Leon County, Florida.
NOTICE OF RIGHT TO JUDICIAL REVIEW
A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE DIVISION OF RETIREMENT, AND A SECOND COPY, ACCOMPANIED BY THE FILING FEES PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, OR WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE PARTY RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.
State Retirement Director Division of Retirement Cedars Executive Center
2639 North Monroe Street, Building C Tallahassee, Florida 32399
(904)488-5540
FILED WITH THE CLERK OF THE DIVISION OF RETIREMENT, THE
15th DAY OF November, 1993.
COPIES FURNISHED:
M. J. Menge Attorney at Law
Shell, Fleming, Davis & Menge Post Office Box 1831
226 Palafox Place Pensacola, Florida 32501 (by Certified Mail)
Robert T. Benton Hearing Officer
Division of Administrative Hearings 1230 DeSoto Building
Tallahassee, Florida 32399
Stanley M. Danek Division Attorney Division of Retirement Cedars Executive Center
2639 North Monroe Street, Building C Tallahassee, Florida 32399
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DISTRICT COURT OPINION
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THE DISTRICT COURT OF APPEAL FIRST DISTRICT, STATE OF FLORIDA
GASPARE B. TAMBURELLO NOT FINAL UNTIL TIME EXPIRES TO
FILE MOTION FOR REHEARING AND
Appellant, DISPOSITION THEREOF IF FILED.
vs. CASE NO. 93-4061
DOAH CASE NO. 92-7366
STATE OF FLORIDA, DEPARTMENT OF MANAGEMENT SERVICES, DIVISION OF RETIREMENT,
Appellee.
/ Opinion filed June 20, 1995.
An Appeal from an order of the Department of Management Services.
M. J. Menge of Shell, Fleming, Davis & Menge, Pensacola, Attorney for Appellant.
Stanley M. Danek of the Division of Retirement, Tallahassee, Attorney for Appellee.
PER CURIAM.
This cause is before us on appeal from the Department of Management Services, Division of Retirement's (DOR) final order rejecting several of the hearing officer's findings of fact to determine that Tamburello had been re- employed within twelve months of his retirement and was, therefore, required to repay retirement benefits made by DOR. We reverse.
As relevant to this appeal, the hearing officer found:
6. The consulting contract specified that petitioner would act as an independent contractor while performing services under the contract, and that he would not be an employee of the College. Petitioner reported the income he received under the consulting contract to the Internal Revenue Service on Schedule C. Petitioner's Exhibit
No. 10. He filled no position at the college. For his services under the consulting contract, the college paid him from its accounts payable account, and withheld no funds to pay federal income taxes of Social Security taxes.
8. Although the College contracted directly with Dr. Tamburello and all parties evidently contemplated his personal services, he was not prohibited from hiring others to assist him in
performing services under the consulting contract, according to unrebutted testimony from College officials. In 1987 Nova University paid petitioner
$6,000 and in 1988 $9,000 for services he performed for that school. Petitioner had formed E&T Management Service Co. prior to 1987, and offered his services as a consultant to the general public.
11. In performing services under the
consulting contract, petitioner set his own hours and determined the type and sequence of the work he performed. While not subject to their control, he reported to the president and the Dean of Continuing Education, as ideas or plans unfolded.
The pre-retirement seminars took place on campus and he occasionally met with Dean Smith or President Hartsell in their offices, but, as a consultant, for the most part, he worked off campus; he had an office at his home.
By June of 1985, petitioner's interest in his retirement benefits had fully vested.
Taking into account the twenty factors utilized by respondent as guidelines to determine whether an individual is an employee or an independent contractor, petitioner's status was that of an independent contractor.
In its final order, DOR rejected these findings in whole or in part as either immaterial or not based on competent, substantial evidence. To the contrary, the hearing officer's findings quoted above are both material and supported by competent, substantial evidence in the appellate record.
Alternatively, DOR further argues that the employee/independent contractor distinction that controls this case is a mixed question of law and fact infused with policy considerations for which DOR has special expertise in deciding and that, as such, it may reject the hearing officer's findings regarding same, whether or not those findings are based on competent, substantial evidence. s 120.57(1)(b)(10), Fla. Stat. (1993); McDonald v. Department of Banking and Finance, 346 So.2d 569 (Fla. 1st DCA 1977)
In the same context as the present case, and on very similar facts, this court recently addressed the employee/independent contractor issue substantially as a question of fact, not a question of law or policy. Davis v. Division of Retirement, 585 So.2d 421 (Fla. 1st DCA 1991). Indeed, DOR concedes that Davis stands for the proposition that the employee/independent contractor determination is susceptible to ordinary methods of proof and is within the authority of the trier of fact. Accordingly, we REVERSE and REMAND with directions that DOR adopt the hearing officer's recommended order as its final order.
REVERSED AND REMANDED WITH DIRECTIONS. BOOTH, JOANOS and LAWRENCE, JJ., CONCUR
================================================================= AMENDED FINAL ORDER ON MANDATE
=================================================================
STATE OF FLORIDA DIVISION OF RETIREMENT
GASPARE B. TAMBURELLO,
Petitioner,
DOAH Case No. 92-7366
vs. DMS DOR Case No. 93-23
DIVISION OF RETIREMENT,
Respondent.
/
AMENDED FINAL ORDER ON MANDATE
THIS CAUSE came on to be considered upon the Mandate from the First District Court of Appeal issued July 28, 1995, in the case of Gaspare B. Tamburello vs. Department of Management Services, Division of Retirement, So.2d (Fla. 1st DCA 1995)(DCA Case No. 93-4061, Opinion rendered June 20, 1995), reversing the Final Order of the Director of the Division of Retirement in this cause.
In that Final Order, the Division determined that Gaspare Tamburello was an employee of Pensacola Junior College (College) under the provisions of the Florida Retirement System, Chapter 121, Florida Statutes and not an independent contractor as claimed by the College.
In its opinion, the First District Court of Appeal reversed and remanded the Final Order directing the Division to adopt the hearing officer's recommended order as the final order in this case.
In accordance with said Mandate and Opinion in the above case, it is:
ORDERED and DIRECTED that the Final Order of-the Division of Retirement entered in the above-styled and numbered cause be and the same is hereby vacated and set aside. It is, further,
ORDERED and DIRECTED that the recommended order of the hearing officer in this cause is adopted as the final order. It is, further,
ORDERED and DIRECTED that the case be closed.
NOTICE OF RIGHT TO JUDICIAL REVIEW
PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE DIVISION OF ADMINISTRATIVE HEARINGS AND A SECOND COPY, ACCOMPANIED BY FILING FEES PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, OR WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE PARTY RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.
DONE and ORDERED this 16th day of August, 1995, at Tallahassee, Leon County, Florida.
J. McMullian III
State Retirement Director Division of Retirement
FILED WITH THE CLERK OF THE DIVISION OF RETIREMENT THIS 17th DAY OF AUGUST, 1995.
AMENDED FINAL ORDER ON MANDATE
Page 3
COPIES FURNISHED:
M.J. Menge Attorney at Law
226 Palafox Place 7th Floor
Pensacola, Florida 32598-1831
Stanley M. Danek Division Attorney Division of Retirement Cedars Executive Center 2639 North Monroe Street Building C
Tallahassee, Florida 32399
Clerk, Division of Administrative Hearings 1230 DeSoto Building
Tallahassee, Florida
| Issue Date | Proceedings |
|---|---|
| Aug. 18, 1995 | Amended Final Order on Mandate filed. |
| Aug. 16, 1995 | Opinion and Mandate filed. |
| Dec. 14, 1993 | AGENCY APPEAL, ONCE THE RETENTION SCHEDULE OF -KEEP ONE YEAR AFTER CLOSURE- IS MET, CASE FILE IS RETURNED TO AGENCY GENERAL COUNSEL. -ac |
| Nov. 15, 1993 | Final Order filed. |
| Nov. 15, 1993 | Final Order filed. |
| Aug. 13, 1993 | Recommended Order sent out. CASE CLOSED. Hearing held June 7, 1993. |
| Jun. 18, 1993 | Respondent`s Proposed Findings of Fact and Conclusions of Law filed. |
| Jun. 18, 1993 | (Proposed) Recommended Order (unsigned) filed. (From M. J. Menge) |
| Jun. 08, 1993 | (Respondent) Notice of Intent to Request Official Recognition w/attached Final Order filed. |
| Jun. 07, 1993 | CASE STATUS: Hearing Held. |
| Feb. 18, 1993 | Joint Response to Initial Order filed. |
| Feb. 18, 1993 | Notice of Hearing sent out. (hearing set for 6-7-93; 1:00pm; Pensacola) |
| Jan. 19, 1993 | Notice of Service of Respondent`s Interrogatories to Petitioner filed. |
| Jan. 14, 1993 | Order sent out. (time for responding to initial order is extended until 1-19-93) |
| Jan. 12, 1993 | (Petitioner) Notice of Appearance of Counsel; Motion for Extension of Time w/(unsigned) Order Granting Motion for Extension of Time filed. |
| Dec. 28, 1992 | Initial Order issued. |
| Dec. 10, 1992 | Notice of Election to Request Assignment of Hearing Officer; Petition for Formal Proceeding (+ Exhibits A-B) filed. |
| Issue Date | Document | Summary |
|---|---|---|
| Jun. 20, 1995 | Opinion | |
| Nov. 12, 1993 | Agency Final Order | |
| Aug. 13, 1993 | Recommended Order | State employee worked within 12 months after retirement but did not have to forfeit retirement benefits because he was independent contractor. |
VERNA M. JOHNSON vs DEPARTMENT OF MANAGEMENT SERVICES, DIVISION OF RETIREMENT, 92-007366 (1992)
JOHN R. NELSON vs DEPARTMENT OF MANAGEMENT SERVICES, DIVISION OF RETIREMENT, 92-007366 (1992)
ERIN MCGUIRE vs DEPARTMENT OF MANAGEMENT SERVICES, DIVISION OF RETIREMENT, 92-007366 (1992)
BABU JAIN vs FLORIDA AGRICULTURAL AND MECHANICAL UNIVERSITY, 92-007366 (1992)
