The Issue Whether the Respondent was required to carry workers' compensation insurance coverage for its employees and, if it failed to do so, whether the Amended Notice and Penalty Assessment Order is correct.
Findings Of Fact At all times material to this case, the Petitioner, the Department of Labor and Employment Security, Division of Workers’ Compensation was the state agency charged with the responsibility of administering compliance with state laws governing workers’ compensation (WC). The Respondent, A. J. Interiors, Inc., is a Florida corporation doing business at 1825 Mears Parkway, Margate, Florida. At all times material to this case, Robert Barnes was an investigator employed by the Department to perform compliance investigations for WC. On July 6, 2000, Investigator Barnes performed a random construction site inspection at a new construction project located at 16687 Jog Road, Delray Beach, Florida. While at that location, Investigator Barnes observed two men wearing T-shirts bearing the company name "A. J. Interiors, Inc." along with its telephone number. The men were installing metal framing in order to hang and finish drywall. The field interview with the two men, identified in this record as Sergio and Jaime Gonzalez, revealed that neither was covered by WC insurance. This information was later confirmed by Investigator Barnes. Additionally, neither man had obtained an exemption from coverage as the sole proprietor of a business. Based upon the field interview of the two men, a review of Department records, and contact with the Respondent's insurance agent, Investigator Barnes correctly determined that the men were the Respondent’s "employees” as that term is defined by the WC law. The men did not supply materials to the job site but agreed to perform work based upon a price described as a "per board" industry standard rate. In other words, the men would hang the drywall at a flat rate (established by and consistent with the local industry standard) for each job accepted through the Respondent. If the work were completed, the men expected to be paid by the Respondent. The men did not contract with or work for the general contractor of the job. The only requirement for payment was the performance of the work. The only risk incurred by the workers related to their relationship with the Respondent. Having concluded that the workers were not covered by WC and were not exempt, Investigator Barnes caused a stop work order to be issued against the Respondent. In conjunction with that order, the Department requested copies of the Respondent's business records. A review of the "vendor accounts” supplied by the Respondent established that its workers were paid amounts presumably based upon the number of boards hung per job identified. The payments were not always the same amount as the number of boards hung for a given job could vary. Additionally, the Respondent allowed workers to receive "draws" against the expected payments for uncompleted jobs. The Respondent’s claim that the workers were independent contractors has not been deemed credible. Based upon the testimony of the Respondent's witness all of the workers performed as outlined by the men interviewed by Investigator Barnes. The Respondent did not have a valid WC policy during the three years preceding the stop work order. The Amended Notice and Penalty Assessment Order prepared by Investigator Barnes accurately calculates the amounts owed by the Respondent for the three-year period.
The Issue The issues are whether nine workers were employees of Respondent, during part of the audit period; whether Respondent failed to secure the payment of workers' compensation coverage in violation of Section 440.107, Florida Statutes (2003); and whether Petitioner should impose a penalty against Respondent in the amount of $123,960.23.
Findings Of Fact Petitioner is the state agency responsible for enforcing the statutory requirement that employers secure the payment of workers' compensation for the benefit of their employees. § 440.107, Fla. Stat. (2002). Respondent is a closely held corporation domiciled in Florida and engaged in the sale and installation of floor coverings. Mr. Dennis Davison and Mrs. Lynne Davison, a married couple, own all of the outstanding stock of Respondent (the owners). Respondent has five in-office employees, including the owners, and had a net worth of approximately $100,000 before paying the proposed penalty. On April 2, 2004, Petitioner's compliance officer conducted a random site inspection of a single-family residence at 213 Northwest 3rd Place, Cape Coral, Florida. Mr. John Walega and Mr. Mike Stephens were laying carpet in the residence (Walega and Stephens, respectively). Walega was a sole proprietor who employed Stephens. The compliance officer determined that Walega was an employee of Respondent because Walega had an expired exemption and no proof of workers' compensation insurance coverage. The compliance officer issued separate stop work orders against Walega and Respondent. The stop work order against Walega is not at issue in this proceeding. The compliance officer issued the stop work order against Respondent even though: she knew that Respondent had compensation coverage for Respondent's five employees through a leasing company; and she had no knowledge that Respondent had subcontractors other than Walega working for Respondent. The compliance officer requested Respondent's business records for the three years from April 2, 2001, through April 2, 2004 (the audit period). Respondent fully complied with the request in a timely manner. The stop work order issued against Respondent on April 2, 2004, also assessed a penalty stated as the greater of $1,000 or 1.5 times the premium Respondent would have paid in premium charges during the period Respondent allegedly failed to secure the payment of workers' compensation insurance. Sometime between April 2 and 16, 2004, Petitioner amended the penalty assessment to $137,820.72. On April 16, 2004, the owners mortgaged their personal residence to pay the amended penalty assessment. Petitioner released the stop work order, but the owners lost business in an unspecified dollar amount while the stop work order was in effect and continue to incur monthly interest expense in the amount of $500 to service the mortgage on their home. On June 28, 2004, Petitioner issued a Seconded Amended Order of Penalty Assessment No. 04-157-D7-2 that reduced the assessed penalty to $123,960.23 (the Seconded Amended Order). Respondent is entitled to a refund in the amount of $13,860.49, but Petitioner had not paid the refund as of the date of hearing. The Second Amended Order is the proposed agency action at issue in this proceeding. The compliance officer is the only employee for Petitioner who investigated and developed the substantive information that forms the basis of Petitioner's proposed agency action. Other employees calculated the actual amounts of the proposed penalties. Respondent does not challenge the mathematical accuracy of the penalty calculations by Petitioner, but challenges the legal and factual basis of Petitioner's determination that nine workers were Respondent's employees. The nine workers are identified in the record as Walega; Messrs. James Allan, Bertin Flores, Cliff Hill, David Lancaster, Earl Lancaster, Jeff Dozier, Anthony Gioe; and Ms. Patricia Lancaster. The statutory definition of an employee for that part of the audit period before January 1, 2004 (the relevant period), was different than the statutory definition that became effective on January 1, 2004. Factual findings concerning the nine workers at issue are driven by one statutory definition during the relevant period and another statutory definition thereafter. Any of the nine workers that satisfied the statutory definition in former Subsection 440.02(15)(d)1, Florida Statutes (2003), of an independent contractor should not have been included in that part of the proposed penalty attributable to the relevant period. Effective January 1, 2004, however, Subsection 440.02(15)(d)1, Florida Statutes (2003), no longer excludes independent contractors in the construction industry from the definition of an employee. Thus, a determination of whether a worker was an independent contractor is not relevant to that portion of the proposed penalty covering any part of the audit period after December 31, 2003. Effective January 1, 2004, Subsection 440.02(15)(c)2, Florida Statutes (2003), no longer excludes a subcontractor, including those that would have satisfied the former definition of an independent contractor, from the definition of an employee unless the subcontractor either executes a valid exemption election or otherwise secures payment of compensation coverage as a subcontractor. There is insufficient evidence to support a finding that any of the nine workers at issue in this proceeding either elected a valid exemption or otherwise secured payment for compensation coverage after December 31, 2003. The nine workers at issue in this proceeding are not excluded from the definition of an employee after December 31, 2004, even if they were independent contractors throughout the audit period. Except for constitutional arguments raised by Respondent over which DOAH has no jurisdiction, Respondent owes that part of the penalty attributable to any period after December 31, 2003. It is undisputed that the nine workers included in that part of the penalty assessment attributable to the relevant period were subcontractors throughout the audit period. Respondent's ledger clearly treated the workers as subcontractors and reported their earnings on Form 1099 for purposes of the federal income tax. Petitioner treated the workers as subcontractors in the penalty calculation. Customers of Respondent paid Respondent for installation of floor coverings they purchased from Respondent, and Respondent paid each of the nine workers to install the floor coverings. The Workers' Compensation Law in effect during the relevant period did not expressly exclude from the definition of an employee those subcontractors who executed a valid exemption election or otherwise secured payment of compensation coverage as a subcontractor. Findings concerning the existence of an exemption election or payment of compensation coverage are neither relevant nor material to the statutory definition of an employee during the relevant period. During the relevant period, the nine workers at issue were excluded from the definition of an employee only if they satisfied the definition of an independent contractor in former Subsection 440.02(15)(d)1, Florida Statutes (2003). Each of the nine workers were required to satisfy all of the following requirements: The independent contractor maintains a separate business with his or her own work facility, truck, equipment, materials, or similar accommodations; The independent contractor holds or has applied for a federal employer identification number, unless the independent contractor is a sole proprietor who is not required to obtain a federal employer identification number under state or federal requirements; The independent contractor performs or agrees to perform specific services or work for specific amounts of money and controls the means of performing the services or work; The independent contractor incurs the principal expenses related to the service or work that he or she performs or agrees to perform; The independent contractor is responsible for the satisfactory completion of work or services that he or she performs or agrees to perform and is or could be held liable for a failure to complete the work or services; The independent contractor receives compensation for work or services performed for a commission or on a per-job or competitive-bid basis and not on any other basis; The independent contractor may realize a profit or suffer a loss in connection with performing work or services; The independent contractor has continuing or recurring business liabilities or obligations; and The success or failure of the independent contractor's business depends on the relationship of business receipts to expenditures. The preponderance of evidence shows that each of the nine workers at issue was an independent contractor during the relevant period. Respondent conducted the ordinary course of its trade or business with each of the nine workers in substantially the identical manner. None of the workers shared office space with Respondent. Each worker used his or her own truck, equipment, and tools to transport the floor coverings sold by Respondent and to install them in a customer's premises. Petitioner admits that Walega was a sole proprietor. Each of the other workers either held a federal employer identification number or was a sole proprietor who was not required to obtain a federal employer identification number. Each worker agreed to perform specific services or work for specific amounts of money and controlled the means of performing the services or work. Each worker incurred his or her own expenses to install floor coverings. Each worker transported floor coverings and necessary materials to the work site in the worker's own truck and used his or her own tools to perform the work. Each worker exercised independent professional judgment to perform the work. Respondent did not perform any pre-installation site inspection and did not perform any site preparation. Respondent did not train workers, instruct workers on how to perform their work, did not supervise their work while it was being performed, and did not perform any post-installation site inspection unless Respondent received a customer complaint. Each worker was responsible for the satisfactory completion of work or services that he or she performed. Each worker was liable to Respondent and the customer for any failure to complete the work or services or for inferior workmanship. Each worker warranted his or her work to the customer's satisfaction and absorbed the costs of rework and any damage to the customer's premises. Respondent paid each worker for work or services performed on a per-job or competitive-bid basis rather than any other basis. Respondent negotiated the price paid to a worker on a square-foot basis. The price did not change regardless of the amount of time the job required or the number of helpers the worker paid to assist the worker on the job. Each worker realized a profit or suffered a loss in installing floor coverings sold by Respondent. Each worker performed work for other vendors and had continuing or recurring business liabilities or obligations apart from installing floor coverings for Respondent. Each worker depended on the relationship of business receipts of expenditures for the success or failure of the worker's business. Each worker maintained his or her own occupational and professional licenses. Each worker maintained his or her own liability insurance. Respondent required each worker to sign a written form stating that the worker was an independent contractor. The form acknowledged the workers' warranty obligations and his or her obligations for their own taxes and insurance. Each form disclosed the workers' social security number or federal employer identification number. Respondent did not withhold federal income taxes from the payments to workers. Petitioner did not explicate the basis for reducing the proposed assessment in the Second Amended Order. However, the evidence reveals that the penalty reduction resulted from the exclusion of corporate subcontractors from the penalty base. The business relationship between Respondent and its corporate subcontractors during the relevant period was substantially the same as that between Respondent and the nine workers at issue. Early in this administrative proceeding on April 8, 2004, the compliance officer advised the owners that she was unable to release the stop work order against Respondent unless she could verify in Petitioner's data base, in relevant part, that the nine workers at issue each had a valid exemption or had insurance. However, Petitioner's database would not have disclosed compensation coverage maintained by a subcontractor through a leasing company. The compliance officer's advice to the owners did not reflect the law in effect during the relevant period. The Workers' Compensation Law in effect during the relevant period did not expressly exclude from the definition of an employee those workers who executed a valid exemption election or otherwise secured payment of compensation coverage as a subcontractor. The law excluded subcontractors from the definition of an employee only if the subcontractors satisfied the statutory definition of an independent contractor. The compliance officer made no effort to determine whether any of the workers she included in the penalty base satisfied the definition of an independent contractor. The compliance officer never advised the owners that establishing a subcontractor as an independent contractor would avoid part of the assessment against Respondent during the relevant period. The compliance officer never advised the owners that Respondent was free to choose to be represented by counsel during the audit process. The compliance officer told the owners that the only thing Respondent could do to avoid the assessment was to provide a certificate of insurance or an exemption for each of the subcontractors included in the penalty base. The compliance officer admitted that she was unaware that a subcontractor who was an independent contractor during the relevant period was legally excluded from the penalty base. Counsel for Respondent advised the compliance officer of the correct legal standard on April 12, 2004, but the compliance officer refused to release the stop work order unless Respondent paid the assessed penalty. The compliance officer knew that Walega had held a valid exemption at various times in the past as a sole proprietor. She knew Walega had renewed the exemption on October 29, 2003, for five years. However, Petitioner's database showed the exemption had expired on January 1, 2004, by operation of new law. Walega provided Respondent with a copy of the exemption he renewed on October 29, 2003. The exemption stated on its face that it was effective for five years. The owners had no actual knowledge that the exemption expired on January 1, 2004, as a result of a change in the Workers' Compensation Law. Petitioner admits that it issued the exemption to Walega knowing that the exemption would expire on January 1, 2004. Petitioner issued the exemption so that Walega could use it until January 1, 2004.
Recommendation Based on the Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order dismissing the disputed charges against Respondent for the relevant period, refunding any overpayment by Respondent, and sustaining the remaining allegations and penalties against Respondent. DONE AND ENTERED this 27th day of August, 2004, in Tallahassee, Leon County, Florida. DANIEL MANRY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 27th day of August, 2004. COPIES FURNISHED: David C. Hawkins, Esquire Division of Legal Services Department of Financial Services 200 East Gaines Street Tallahassee, Florida 32399-4229 Susan McLaughlin, Esquire Law Offices of Michael F. Tew Building 800, Suite 2 6150 Diamond Center Court Fort Myers, Florida 33912 Honorable Tom Gallagher Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Pete Dunbar, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
Findings Of Fact 13. The factual allegations contained in the Stop-Work Order and Order of Penalty Assessment issued on February 11, 2009, the Amended Order of Penalty Assessment issued on March 5, 2009, the 2"4 Amended Order of Penalty Assessment issued on March 11, 2009 and the 3 Amended Order of Penalty Assessment issued on October 30, 2009, which are fully incorporated herein by reference, are hereby adopted as the Department’s Findings of Fact in this case.
Conclusions THIS PROCEEDING came on for final agency action and Alex Sink, Chief F inancial Officer of the State of Florida, or her designee, having considered the record in this case, including the Stop- Work Order and Order of Penalty Assessment and the Amended Orders of Penalty Assessment served in Division of Workers’ Compensation Case No. 09-036-D1, and being otherwise fully advised in the premises, hereby finds that: 1. On February 11, 2009, the Department of Financial Services, Division of Workers’ Compensation (hereinafter “Department”) issued a Stop-Work Order and Order of Penalty Assessment in Division of Workers’ Compensation Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. 2. On February 11, 2009, the Stop-Work Order and Order of Penalty Assessment was served by personal service on BEST WELDING AND FABRICATION, INC. A copy of the Stop-Work Order and Order of Penalty Assessment is attached hereto as “Exhibit A” and incorporated herein by reference. 3. On March 5, 2009, the Department issued an Amended Order of Penalty Assessment in Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. The Amended Order of Penalty Assessment assessed a total penalty of $196,980.30 against BEST WELDING AND FABRICATION, INC. 4. On March 16, 2009, the Amended Order of Penalty Assessment was served by certified mail on BEST WELDING AND FABRICATION, INC. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 5. On March 11, 2009, the Department issued a 2°4 Amended Order of Penalty Assessment in Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. The an Amended Order of Penalty Assessment assessed a total penalty of $50,968.94 against BEST WELDING AND FABRICATION, INC. . 6. On March 26, 2009, the 2°4 Amended Order of Penalty Assessment was served by certified mail on BEST WELDING AND FABRICATION, INC. A copy of the 2"! Amended Order of Penalty Assessment is attached hereto as “Exhibit C” and incorporated herein by reference. 7. The Employer requested a formal hearing on April 6, 2009. A copy of the Request for Hearing is attached hereto as “Exhibit D” and incorporated herein by reference. 8. On April 21, 2009, the request for formal hearing was forwarded to the Division of Administrative Hearings for assignment of an Administrative Law Judge. The matter was assigned to Administrative Law Judge Barbara Staros and given case number 09-2138. 9. On October 30, 2009, the Department issued a 3rd Amended Order of Penalty Assessment in Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. The 3rd Amended Order of Penalty Assessment assessed a total penalty of $10,179.61 against BEST WELDING AND FABRICATION, INC. 10. On October 30, 2009, the 3™ Amended Order of Penalty Assessment was served on legal counsel for BEST WELDING AND FABRICATION, INC. A copy of the 3" Amended Order of Penalty Assessment is attached hereto as “Exhibit E” and incorporated herein by reference. 11. On November 9, 2009, BEST WELDING AND FABRICATION, INC. filed a Notice of Voluntary Dismissal. A copy of the Notice of Voluntary Dismissal is attached hereto as “Exhibit F” and incorporated herein by reference. 12. On November 12, 2009, an Order Closing File was entered. The Order Closing File relinquished jurisdiction to the Department. A copy of the Order Closing File is attached hereto as “Exhibit G” and incorporated herein by reference.
The Issue Validity of Petitioner's reduction in pay pursuant to Chapter 22A-2, Florida Administrative Code. These are appeals of 12 career service employees of the Department of Environmental Regulation to the Career Service Commission, pursuant to Section 110.061, Florida Statutes and Rule 22A-10.05, Florida Administrative Code. The appeals were consolidated for purposes of hearing by Prehearing Conference Order, dated July 14, 1976, by reason of similar issues of law and fact. A list of the appellants is attached hereto and this order applies to all of the cases. Prior to the hearing, the parties stipulated to undisputed facts and contested issues of law. Although the Department of Administration objected to the relevancy of the facts and exhibits stipulated to in Paragraph I of the "Pretrial Stipulation", it is determined that such facts and exhibits are relevant to these proceedings and the objection is overruled. (Composite Exhibit 1) The stipulated facts and the exhibits referred to therein are as follow: Stipulation of Facts Petitioners are twelve (12) career service employees of the Department of Environmental Regulation. All have attained the requisite employment status for pursuing this action, and all jurisdictional requirements, including the proper and timely filing of appeals, have been met. This cause arises from a reduction in Petitioners' pay which resulted from actions set forth below. Petitioners seek an order increasing their pay in an amount equal to the reduction, and retroactive reimbursement of the amount of the reduction for each month from January 26, 1976, the effective date of the reduction, plus reasonable attorneys fees and expenses. The amount of reduction for each employee is set forth in Exhibit no. 1 attached hereto. In accordance with Section 4(5), Chapter 75-22, Laws of Florida, the Department of Environmental Regulation collocated their Ft. Lauderdale district office with the Water Management District located in West Palm Beach. This action resulted in the physical relocation of the DER district office from Broward to Palm Beach County, a distance of approximately 40 miles. The Ft. Lauderdale office was closed on January 26, 1976 and all employees reported for work to West Palm Beach on January 27, 1976. No change in the working status of the employees pertinent to this appeal resulted from this move. Nine of the twelve employees continue to reside in or near Ft. Lauderdale. The remaining three employees moved to West Palm Beach after the relocation (collocation) of the district office. The competitive geographical pay differential has also been known as the geographical special appointment rate (GAR). See F.S. s. 110.022 and F.A.C. s. 22A-2.04 & 2.06. This differential represented a salary adjustment for certain positions in areas where the statewide minimum salaries were not competitive with that of local government and subsequently other employers. Its purpose was to meet competition in a local area and act as an incentive to attract qualified employees to state positions. It was not a differential based on a Cost of Living study. The manner in which the petitioners' reduction in pay was calculated by Respondents was: Subtract the statewide minimum salary for the employee's class, as found in the Classification and Pay Plan issued by the Department of Administration, Division of Personnel, from the minimum salary approved for the class for Broward County, as found in the Classification and Pay Plan. This amount is then subtracted from the employee's rate of pay to determine the new rate of pay. if a competitive geographical pay differential had been approved by the Division of Personnel for the class to which the employee was being assigned in Palm Beach County, subtract the statewide minimum salary for the class from the minimum salary approved for the class for Palm Beach County, as found in the Classification and Pay Plan. The amount in (3) would then be added to the employee's rate of pay as determined in (2) above to obtain the new rate of pay. Exhibit 1 attached hereto contains the competitive geographical pay differential (GAR) for each employee as computed in the manner above. No employee's salary prior to reduction (Broward County) would have exceeded the maximum pay scale for Palm Beach County set forth in the Classification and Pay Plan as shown in Exhibit no. 2 attached hereto. The employees were advised by letter of January 8, 1976, copies of which are attached as composite Exhibit no. 3. The Department of Environmental Regulation opposed the reductions in pay of Petitioner employees as well as others not parties to this action. This opposition included a letter, attached as Exhibit no. 4, to Lt. Governor Williams requesting no reductions be made and a conference on the subject between Mr. Steven Wilkerson, Director, Division of Administration for the Department and Mr. William H. Wilder, Chief, Bureau of Classification and Pay, Division of Personnel, Department of Administration. The Ltd. Governor's response is attached as Exhibit no. 5. Competitive geographical pay differentials became a matter of concern between the Division of Personnel and the Department in September of 1975. Mr. Gene Witkowski of the Division of Personnel (DOA) referred to the memorandum of Mr. William H. Wilder of October 1972 as governing the situation. The Department requested a copy of the memorandum. Mr. Witkowski stated the opinion that the Department was bound to follow the guidelines of the October 1972 memorandum, attached as Exhibit 6. This conversation was followed by a letter attached as Exhibit no. 7 from Mr. Conley Kennison, State Personnel Director, essentially reaffirming Mr. Witkowski's remarks. On December 18, 1976, Ms. Yates requested guidance as to whether affected employees could appeal their salary reductions. That letter is attached as Exhibit no. 8. Mr. Kennison, by letter of January 5, 1976, attached as Exhibit 9, stated these reductions were not appealable. The Department processed the reduction in pay pursuant to the October 1972 memorandum of Mr. William H. Wilder. The reductions were effective January 26, 1976. The monthly reduction for each employee is shown by Exhibit no. 1. The Department of Administration objects to the relevancy of the facts and Exhibits stipulated to in this paragraph I, but does not contest the factual truth of the matters or the authenticity of the Exhibits. The Petitioners in this cause are as follows: Patricia A. Murphy was employed June 17, 1974 as Clerk Typist III. She attained permanent status December 17, 1974. She was a Clerk Typist III at the time of her pay reduction January 26, 1976. Her position remained the same after the relocation of the district office to West Palm Beach. Faye W. Stone was employed July 17, 1974 as a Clerk Typist II. She received several promotions and was a Secretary III at the time of her pay reduction January 26, 1976. She achieved permanent status as a Secretary III. Her position remained the same after the relocation of the district office to West Palm Beach. Ruth Seward was employed July 21, 1972 as a Secretary III. She attained permanent status January 21, 1973. She was a Secretary III at the time of her pay reduction January 26, 1976. Her position remained the same after the relocation of the district office to West Palm Beach. Janet Bigelow was employed March 8, 1971 as a Secretary III. On September 29, 1973, she attained permanent status as an Administrative Assistant I (promotion). Her position remained the same after the relocation of the district office to West Palm Beach. Patricia K. Galyon was employed by the state on January 11, 1971 and was transferred to the Department of Pollution Control (now DER) on January 28, 1974 as a Secretary II. At the time of her pay reduction on January 26, 1976, she had achieved permanent status as an Engineering Technician III (promotion). Her position remained the same after the relocation of the district office to West Palm Beach. Clifford S Rohlke was employed May 21, 1974 on OPS, and then on September 6, 1974 received an original appointment as an Engineering Technician IV. At the time of his pay reduction January 26, 1976, he had achieved permanent status as an Engineering Technician IV. His position remained the same after the relocation of the district office to West Palm Beach. Patricia Valkenaar was employed May 15, 1974. She attained permanent status as an Engineering Technician IV November 6, 1975. Her position remained the same after the relocation of the district office to West Palm Beach. Albert W. Townsend was employed January 18, 1971 as an Engineering Technician II. He achieved permanent status as an Engineer I April l, 1975 (promotion). His position remained the same after the relocation of the district office to West Palm Beach. Michael R. Fawley was employed October 16, 1972 as an Engineering Technician II. He was promoted to Engineering Technician III January 4, 1973, prior to attaining permanent status as an Engineering Technician II, and achieved permanent status in that class December 2, 1975. He received several promotions and was a trainee Engineer III as of January 26, 1976. His position remained the same at the time of the relocation of the district office to West Palm Beach. He is presently a probationary Engineer III. David J. Karsmarski was employed as a federal employee/ state assignee June 1972 in the capacity of Engineer. (GB-9 or Engineer II). He was sequently employed by the state as an Engineer III where he achieved permanent status. His position remained the same at the time of the relocation of the district office to West Palm Beach. Julian A. Bucklin, Jr. was employed November 29, 1974 as an Engineer III. He has achieved permanent status. His position remained the same at the time of the relocation of the district office to West Palm Beach. Dennis M. Stotts was employed August 23, 1974 as a Pollution Control Specialist II. He requested a voluntary demotion and transfer to Chemist I, a lower position, from the Northeast region to Southeast due to marriage, and attained permanent status in that position on May 29, 1975. His position remained the same at the time of the relocation of the district office to West Palm Beach. An addendum stipulation provides as follows: "The legislative language was understood by Department of Environmental Regulation to be more than just a simple request to study collocation. It was understood to mean if practicable any Department of Environmental Regulation Office should be collocated with a Water Management District Office. The Fort Lauderdale Office was collocated for several reasons. Rent in Fort Lauderdale was $30,000 a year. Rent in the West Palm Beach Central and Southern District Office is $1.00. The Water Management District owned the building which is a multimillion dollar complex with excellent accessibility to the local airport and major transportation arteries. Collocation allowed for fewer meetings for applicants who had to travel between Fort Lauderdale and West Palm Beach. Greater permit coordination was achieved in terms of Chapter 403 and 373, Florida Statutes, as well as surface water management. The delegation of certain water quality responsibilities was also made possible. Since Dade, Broward and Palm Beach Counties have local programs the move to West Palm Beach was not considered inconvenient to Palm Beach and other counties in the northern end of the district. The Department knew in advance of collocation there might be salary problems because of the interpretation that might be placed on the GAR by the Department of Administration. In addition to Composite Exhibit 1 (Pretrial Stipulation) and the exhibits attached thereto, the following additional exhibits were received in evidence. Composite Exhibit 2 - Employment status forms Exhibit 3 - Recommendations to the Administration Commission for changes in the personnel rules and regulations. Exhibit 4 - Classification and Pay Plan, effective, July 1, 1974. Composite Exhibit 5 - Attorney's affidavits and attorney's fees. Exhibit 6 - DER Staff Legal Opinion concerning geographic pay differentials, DER, February 10, 1976.
Recommendation That the Petitioner's appeal be denied. Done and Entered this 22nd day of September, 1976, in Tallahassee, Florida. THOMAS C. OLDHAM Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Ross A. McVoy, Esquire Assistant General Counsel Department of Environmental Regulation 2562 Executive Center Circle, E. Montgomery Building Tallahassee, Florida 32301 M. Stephen Turner, Esquire THOMPSON, WADSWORTH, MESSER, TURNER AND RHODES 131 N. Gadsden Street P.O. Box 1876 Tallahassee, Florida Mr. Conley M. Kennison State Personnel Director Department of Administration Division of Personnel Carlton Building Tallahassee, Florida 32304 Mrs. Dorothy Roberts Appeals Coordinator Division of Personnel & Retirement Department of Administration 530 Carlton Building Tallahassee, Florida 32304 APPENDIX LIST OF CLAIMANTS D.O.A.H. Case No. 76-962 - Patricia Galyon - Clifford S. Rohlke - Patricia Ann Murphy - Dennis Stotts - Julian Bucklin - Faye Stone - Michael R. Fawley - Ruth G. Seward - David Karsmarski - Patricia C. Valkenaar - Albert Townsend - Janet Bigelow ================================================================= AGENCY FINAL ORDER ================================================================= BEFORE THE SERVICE COMMISSION OF THE STATE OF FLORIDA IN THE APPEAL OF: JANET C. BIGELOW, et al. against REDUCTION IN PAY DOCKET NOS. 76-16, 76-17, and 76-19 thru 76-28 by the DEPARTMENT OF ENVIRONMENTAL REGULATION Chairman Catherine W. Chapin and members Clare C. Leiby and Edwin G. Fraser participating. /
Findings Of Fact Based on the stipulations of the parties, on the exhibits received in evidence, and on the testimony of the witnesses at hearing, the following facts are found: The Petitioner, Anna Torres, (hereinafter "Torres") worked for the Department of Transportation as a toll collector at the Golden Glades toll plaza and was a career service employee at all times pertinent to this case. At the time of the events giving rise to this case, Torres had been employed by the Department for about eight years. Torres was authorized to be on approved leave from October 24, 1989, through November 8, 1989. Torres used that period of leave to drive from South Florida to California to visit her parents. Torres was accompanied on the trip by her roommate. Torres was expected to return to work on November 9, 1990. Torres' father had been sick for several years and during her visit his condition took a sudden turn for the worse, as a result of which it was necessary for her father to be hospitalized. Torres was very concerned about her father's medical condition and felt a need to remain in California until it could be determined whether her father was going to recover from his worsened condition. To facilitate a longer stay in California, Torres' mother offered to pay Torres' airfare from California to Florida in the event Torres could not obtain additional leave, and the roommate offered to drive the car back. On November 7, 1989, Torres placed a telephone call from her parents' home in California to the Golden Glades toll plaza. She spoke with Mildred Burham, who was, and is, the assistant manager at the Golden Glades toll plaza and the supervisor of one of the shifts. Mildred Burham was not the supervisor of Torres' shift. The essence of what Torres told Mildred Burham is that, because of a family emergency, Torres needed to stay in California for another two weeks and wanted a two week extension of her vacation. Torres also asked Mildred Burham to convey the message to Vera Hulse. 1/ Vera Hulse was, and is, the manager of the Golden Glades toll plaza. At that time, Torres did not have sufficient annual or sick leave to cover an additional absence of two weeks. During the November 7, 1989, telephone conversation, Mildred Burham told Torres that she (Burham) would "check into" the request for additional leave and would convey Torres' message to Vera Hulse. Ms. Burham did not tell Torres that the two week extension of her vacation was approved. 2/ During the November 7, 1989, telephone call, Torres did not give Ms. Burham the telephone number at her parents' house in California. Instead, she told Ms. Burham that if they needed to get in touch with her, they could call Torres' son at her home in Florida and he could give them the California telephone number. When Ms. Burham told Vera Hulse about the telephone call from Torres, something apparently got lost in the translation. The message communicated to Ms. Hulse was to the general effect that Torres had called and said that because of a family problem Torres would not be back to Florida for another two weeks. Ms. Hulse was not advised that Torres was requesting leave; only that Torres would be two weeks late getting back due to a family problem. Torres was scheduled to work on the following days: November 9, 10, 11, 14, and 15, 1989. Torres did not report for work on any of those days, nor did she have any other communication with her employer after the telephone communication of November 7, 1990, until November 20, 1989, when Torres called again. Between November 9 and November 20, 1989, Ms. Burham and Ms. Hulse called Torres' home telephone number in an effort to contact her son and obtain the telephone number where Torres was staying in California. Those efforts were unsuccessful. On November 9, 10, 11, 14, and 15, 1989, Torres was placed on unauthorized leave without pay. On November IS, 1989, the Department sent Torres a letter advising her that because she had failed to report for work and had been on unauthorized leave without pay since November 10, 1989, she was deemed to have abandoned her position and to have resigned from the Career Service.
Recommendation For all of the foregoing reasons, it is recommended that the Department of Administration enter a final order in this case concluding that the Petitioner, Anna Torres, did not abandon her position of employment with the Department and ordering that she be reinstated to her position as a toll collector with back pay. DONE AND ENTERED at Tallahassee, Leon County, Florida, this 27th day of June, 1990. MICHAEL M. PARRISH, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 904/488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of June, 1990.
The Issue Whether Respondent Wal-Mart Stores, Inc. (Wal-Mart) engaged in an unlawful employment practice with respect to Petitioner Roberta Trevarthen (Ms. Trevarthen).
Findings Of Fact Roberta Trevarthen is a female who worked for Wal-Mart for two and one-half years until she was terminated August 3, 1999. Ms. Trevarthen has had a long career as a loss prevention specialist and was functioning in that capacity for Wal-Mart during times pertinent to this case. A loss prevention specialist uses surreptitious observation techniques to stop theft that might be committed by customers or employees or both. Wal-Mart is a retail outlet having stores across the United States. One of the stores Wal-Mart owns and operates is located in Port Orange, Florida. The Florida Commission on Human Relations administers the Florida Civil Rights Act of 1992. Ms. Trevarthen was on duty as a loss prevention specialist in the Port Orange, Wal-Mart store on August 2, 1999. On that day she spotted a man whom she believed was acting suspicious and who might be planning to shoplift. He was a dirty white male who appeared to be a transient. Ms. Trevarthen observed the suspect go in and out of the store on three occasions and then observed him re-enter the store. She followed him to the electronics section and observed him pick up an item in a Blistex container. Thereafter James W. Barlow (Mr. Barlow), another loss prevention specialist working in the store joined her. Ms. Trevarthen suggested that they looked suspicious huddled together so she asked Mr. Barlow to move away. Ms. Trevarthen then observed the suspect enter the fitting room with the object in his hands concealed by a pair of men's trousers. When the suspect left the fitting room he put the trousers on a display stand. Ms. Trevarthen asked Mr. Barlow to check the fitting room and he found no merchandise there. Ms. Trevarthen watched the suspect walk toward the grocery section and believed that he had an unnatural bulge in his trousers. Then she observed him walk past the cash register section and observed him exit the front door. Ms. Trevarthen did not continuously observe the suspect from the time she first suspected he had lifted merchandise, until when he departed the store. Once the suspect exited the store, Ms. Trevarthen, Mr. Barlow, and a stocker named Eddie Gregory, stopped the suspect, and required him to accompany them to the Security Office. No merchandise was found on his person. The suspect said that he had left the merchandise he had picked up on a counter by the fitting room. The two loss prevention specialists went with him to that area and there found a comb and mirror set. Pursuant to Wal-Mart procedures, a loss prevention specialist must satisfy five elements before deciding to stop a shoplifting suspect. The specialist must see the person take merchandise from its resting place in the store; must observe the person conceal the merchandise; must maintain observation of the person at all times prior to the stop; must observe the person fail to pay for the merchandise; and must allow the person to exit the vestibule before effecting the stop. Ms. Trevarthen failed to comply with the element requiring constant observation of the suspect and thus, in loss prevention parlance, made a "bad stop," which means the stop failed to produce evidence sufficient to prosecute the suspect as a thief. Although Mr. Barlow is a co-equal loss prevention specialist, and he helped stop the suspect, it was Ms. Trevarthen who initiated the operation, made the decision to stop the suspect, and actually effected the stop. Therefore, in accordance with Wal-Mart policy, the responsibility for the bad stop rested entirely on her. The loss prevention specialist who makes a stop is responsible for making the report concerning it, whether it is a good stop or a bad stop. If a bad stop is made, the loss prevention specialist is required to notify the store manager and the district loss prevention supervisor. When these events occurred, Robert Mulak (Mr. Mulak) was the store manager and Peter Greer (Mr. Greer), was the district loss prevention supervisor. Ms. Trevarthen did not immediately tell Mr. Mulak or Mr. Greer about the bad stop. Mr. Greer learned of it the next day when Mr. Barlow informed him telephonically. Ms. Trevarthen was the recipient of acceptable performance reviews on May 8, 1998, and January 18, 1999. She was given a "Coaching for Improvement Form" on April 11, 1998, by Joe T. Moore, who is currently the store manager, and again on November 24, 1998, by Mr. Greer. These forms are given subsequent to counseling sessions. Bad stops precipitated these "Coaching for Improvement Forms." The first coaching was nothing more than a counseling session. The subsequent coaching was termed a "decision-making" session and was a serious event. During this session she was advised that another bad stop could result in her termination. A "decision-making" session, recorded on a "Coaching for Improvement Form," leaves an employee with no doubt that his or her job is in jeopardy. Generally speaking, Ms. Trevarthen's peers and superiors seemed to have a higher opinion of her performance than the performance and counseling reports indicate. She made 200 successful stops in one year, which was considered to be exceptional by her supervisor. Nevertheless, Ms. Trevarthen violated loss prevention doctrine when she stopped the suspect on August 2, 1999, because she did not observe the suspect from the time he was thought to have concealed merchandise until the time he was stopped. Moreover, she compounded the situation by failing to report it to the store manager and to Mr. Greer, the district loss prevention supervisor. This latter failing was an unforgivable breach and resulted in her termination by Mr. Greer on August 3, 1999. Providing guidance to Mr. Greer, with regard to his decision to terminate Ms. Trevarthen, was a Wal-Mart document addressing loss prevention that was titled, Reasons for Immediate Dismissal. One of the reasons permitting immediate dismissal is set forth as follows: "Any breach of Company policy where the In-Store Loss Prevention Associate is in direct violation of Company policy rules, procedures, directives, safety procedures, or regulations which relate to a breakdown of integrity, job performance or the ability to perform his/her duties will be cause for immediate termination from employment." Mr. Barlow did not experience any disciplinary action as a result of this stop because it was not his stop and it was not his duty to report it. Mr. Barlow explained to Mr. Greer that he delayed reporting the incident because he wanted to give Ms. Trevarthen the opportunity to decide on her own to report it. Mr. Barlow perceived that Ms. Trevarthen was afraid to report it because she feared disciplinary action. Ms. Trevarthen was told by Mr. Greer on one occasion, "You are a gal, whip these guys' butts." She also once heard someone say, "Hush up, there's a broad here." On one occasion she had, in her own words, "kiddingly" been called a "girl." Her testimony indicated that she was in no way offended by the manner in which these words were used. The only evidence Ms. Trevarthen could produce which may have tended to prove that she was the victim of discrimination were the foregoing statements. The first statement appears to have been an attempt to motivate her to greater production. The second indicates that something was being said that was, in someone's opinion, inappropriate for a lady to hear. The references to her being a girl appear to have been made in jest. Mr. Barlow has known Ms. Trevarthen for several years, and had worked with her for more than a year, and he never heard her complain about gender discrimination until the inception of this case. Mr. Greer stated that he harbored no prejudice toward women employees and stated that, "He was only interested in people who got the job done." He further related that he wanted people working for him who made him look like a good manager. Wal-Mart has a policy against discrimination. This is explained to employees in the Associate Handbook which has a section titled, "Respect for the Individual." In this section are the words, "It is the policy of Wal-Mart to provide recruitment, hiring, training, promotion, and other conditions of employment without regard to race, color, age, gender, religion, disability, national origin, or veteran status." At the time of her discharge Ms. Trevarthen was being paid $10.47 per hour and was working 40 hours per week. Immediately subsequent to termination she was unemployed for as long as four months. She lost her investigative license because she was not working in the loss prevention field. After about a year she obtained a job working with abused children and was paid $9.20 per hour for 32 hours per week. After six months she began working 40 hours per week. After a year her wage was increased to $9.32 per hour. After a year and one-half her wage was increased to $9.52 per hour. In April of 2003, her wage was increased to $10.05 per hour. At Wal-Mart she had a 401(k) plan that Wal-Mart supplemented with $20 per week, and insurance benefits. Wal- Mart also provided health insurance. No 401(k) plan is offered at her current place of employment.
Recommendation Based upon the Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered which dismisses Ms. Trevarthen's Charge of Discrimination and Petition for Relief. DONE AND ENTERED this 22nd day of September, 2003, in Tallahassee, Leon County, Florida. S HARRY L. HOOPER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 22nd day of September, 2003. COPIES FURNISHED: Peter R. Corbin, Esquire Ford & Harrison, LLP 121 West Forsyth Street, Suite 1000 Post Office Box 41566 Jacksonville, Florida 32202 David Glasser, Esquire Glasser and Handel Suite 100, Box N 150 South Palmetto Avenue Daytona Beach, Florida 32114 Denise Crawford, Agency Clerk Florida Commission on Human Relations 2009 Apalachee Parkway, Suite 100 Tallahassee, Florida 32301 Cecil Howard, General Counsel Florida Commission on Human Relations 2009 Apalachee Parkway, Suite 100 Tallahassee, Florida 32301
The Issue The issue for determination is whether Petitioner's claim is barred by Section 760.11(7), Florida Statutes (1999), because Petitioner filed a request for hearing more than 35 days after the time prescribed in Section 760.11(3) for a determination of reasonable cause by the Florida Commission on Human Relations (the "Commission"). (All statutory references are to Florida Statutes (1999) unless otherwise stated).
Findings Of Fact Respondent employed Petitioner from May 25, 1995, until September 1, 1995. Petitioner filed a Charge of Discrimination with the Commission on October 3, 1995. The Charge of Discrimination alleges that Petitioner was forced to leave his position of employment because of Petitioner's sex, color, national origin, and age. The Charge of Discrimination contains no more specific factual allegation of an adverse employment action or other act of discrimination. Time Limits The Charge of Discrimination was timely filed pursuant to Section 760.11(1). The filing date of October 3, 1995, fell within 365 days of May 25, 1995, which is the first day on which the alleged discrimination could have occurred. Section 760.11(3) authorizes the Commission to issue a determination of reasonable cause within 180 days of October 3, 1995, the date Petitioner filed the Charge of Discrimination. Counting October 4, 1995, as the first day of the 180-day time limit, Section 760.11(3) authorized the Commission to determine reasonable cause no later than March 31, 1996. The Commission issued a Notice of Determination: No Cause on July 14, 1999. Section 760.11(7) required Petitioner to file a request for hearing within 35 days of March 31, 1996. Counting April 1, 1996, as the first day of the 35-day period, Section 760.11(7) required Petitioner to file a request for hearing no later than May 5, 1996. Petitioner did not timely file a request for hearing. Petitioner first requested a hearing in the Petition for Relief filed on August 13, 1999. Petitioner filed his request for hearing approximately 1,185 days late and 1,220 days after the expiration of the 180-day time limit prescribed in Section 760.11(3). Petitioner delayed the request for hearing because he did not have the form entitled Petition for Relief. Section 760.11(7) statutorily bars Petitioner's claim. Section 760.11(7) expressly provides, in relevant part: If the aggrieved person does not request an administrative hearing within the 35 days, the claim will be barred.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Commission enter a final order dismissing this proceeding as barred by Section 760.11(7). DONE AND ENTERED this 6th day of June, 2000, in Tallahassee, Leon County, Florida. DANIEL MANRY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 6th day of June, 2000. COPIES FURNISHED: Sharon Moultry, Clerk Florida Commission on Human Relations 325 John Knox Road, Building F Tallahassee, Florida 32303-4149 Dana A. Baird, General Counsel Florida Commission on Human Relations 325 John Knox Road, Building F Tallahassee, Florida 32303-4149 Luis F. Hernandez 1116 Golden Gate Avenue Orlando, Florida 32808 Charles Williams, Jr., Esquire Scott A. Livingston, Esquire Williams and Davis, P.A. Suite 1220, Suntrust Center Post Office Box 1831 200 South Orange Avenue Olando, Florida 32802-1831
The Issue The issue is whether Petitioner, Triple M Enterprises, Inc., employed persons in the State of Florida without obtaining workers' compensation insurance meeting the requirements of Chapter 440, Florida Statutes. If Petitioner did not obtain the required insurance, the subsequent issue is the amount of any penalty.
Findings Of Fact The Division is charged with the regulation of workers' compensation insurance in the State of Florida and is responsible for enforcing the statutory requirement that employers secure workers' compensation insurance for the benefit of their employees. Triple M, is a corporation located at 24393 North 71, Robertsdale, Alabama, and is a framing and drywall contractor. Dwain Sanders and Celina Sanders are principals of Triple M. On June 4, 2004, Triple M was engaged as a subcontractor in the construction of a building on the premises located at 334 Gulf Breeze Parkway, Gulf Breeze, Florida. On June 4, 2004, Patricia Jean Krossman was an investigator employed by the Division. Her duties include ensuring that the employers in the state are in compliance with the requirements of the Workers' Compensation Law. More specifically, she visits work sites, and determines if the workers are covered by workers' compensation insurance. The morning of the aforementioned date, Ms. Krossman visited 334 Gulf Breeze Parkway, in Gulf Breeze, Florida, and observed four men engaged in construction activities, including framing a building. Dwain Sanders, who was at the site, identified himself as the owner and president of Triple M, which was the employer of the four men who were working at the site. Ms. Krossman requested that Mr. Sanders provide her with proof that he had workers' compensation coverage effective in Florida. Mr. Sanders made an immediate effort to supply the requested proof. Pursuant to Mr. Sanders' request, his insurance agent in Montgomery, Alabama faxed a portion of Triple M's policy to the Division's Pensacola office. The documents received by Ms. Krossman caused her to conclude that Triple M had not complied with Florida law because she believed the document did not demonstrate that Florida premium rates were paid, or that Florida class codes were used, or that there was a Florida endorsement in place. Ms. Krossman conducted a database search of the Coverage and Compliance Automated System database and the National Council on Compensation Insurance database. The search did not demonstrate that Triple M had a policy then effective in Florida. Having concluded that the documents produced by Triple M failed to demonstrate coverage in accordance with Chapter 440, Florida Statutes, and after noting the absence of policy information in the databases, Ms. Krossman issued a Stop- Work Order to Triple M on June 4, 2004. The portion of Triple M's policy, provided by Triple M's insurance agent by facsimile, number 748-36-79, which was issued by the American Home Assurance Company to Triple M, had a classifications of operations page which related solely to work to be performed in Alabama. This page provided class codes, the rates, and the premium basis which provided the total estimated annual premium that Triple M was required to pay, based on Alabama law. The faxed document included a policy information page that provided in Item 2, that the policy period ran from January 1, 2004 until January 1, 2005. It provided in Item 3A, as follows: "Workers Compensation Insurance: Part One of the policy applies to the Workers' Compensation Law of the states listed here: AL." The policy information page provided in Item 3C that, "Part Three of the policy applies to the states, if any, listed here:" and lists 44 states, including Florida. The policy provides in Item 4, "Classifications of Operation," a statement of the rating group, and the "total classification premium increase limits," under the heading, "State of Alabama Totals." On June 25, 2004, Ms. Krossman received via facsimile machine, an endorsement to policy no. WC 748-36-79. This was the first time Ms. Krossman had seen this endorsement. It purported to add Florida coverage using Florida premium rates and class codes. It also purported to add the Gulf Breeze Parkway work-site where Ms. Krossman found Triple M engaged in construction activities. The base policy, on its face, indicated a date of January 1, 2004. The issue date of the endorsement was June 16, 2004. This endorsement was not in effect on June 4, 2004, the date of the Stop Work Order. Ms. Krossman served Triple M a "Request for Production of Business Records for Penalty Assessment Calculation." The Division has the statutory authority to request payroll records from an employer working in Florida and the "Request for Production of Business Records for Penalty Assessment Calculation" is the vehicle through which those records are sought. The payroll records provide the data required to calculate any penalties for failure to maintain required coverage. Penalties are calculated by determining the premium amount the employer would have paid based on his or her Florida payroll, and multiplying by a factor of 1.5. In response to the "Request for Production of Business Records for Penalty Assessment Calculation," Triple M provided payroll records. The records indicated that Triple M had employed workers in Florida in 2001, 2002, 2003, and 2004. Using the records provided by Triple M, the penalty was calculated by Ms. Krossman. After some interaction with Ms. Celina Sanders, of Triple M, she eventually determined that the proper penalty to be assessed was $36,521.61. The penalty was calculated using Florida premium rates and class codes in accordance with the dictates of Section 440.38, Florida Statutes. The penalty is correct. Triple M depends on its agent, the Goff Group, of Montgomery, Alabama, to provide proper insurance coverage. As noted above, Item 3.A of the policy listed the primary state of coverage as being Alabama. The policy plainly states at "Part Three - Other States Insurance, How This Insurance Applies," in paragraph 1, that "This other states insurance applies only if one or more states are shown in Item 3.C of the Information Page." One of the other states shown is Florida. At paragraph 2, of the section noted immediately above, the policy states, "If you begin work in any one of those states after the effective date of this policy and are not insured or are not self-insured for such work, all provisions of the policy will apply as though that state were listed in Item 3.A of the Information Page." At paragraph 3 of the policy, the following sentence is found: "We will reimburse you for the benefits required by the workers' compensation law of that state if we are not permitted to pay the benefits directly to persons entitled to them." At paragraph 3, the following sentence is found: "If you have work on the effective date of this policy in any state not listed in Item 3.A. of the Information Page, coverage will not be afforded for that state unless we are notified within thirty days." After that language is the following: "B. Notice. Tell us at once if you begin work in any state listed in Item 3.C. of the Information Page." The plain language of the policy reveals that Triple M's employees were covered by the policy, and that the employees would receive the same benefits, in case of injury, as if it were a Florida Policy with Florida rates and classifications, so long as the work at Gulf Breeze Parkway had not been going on for more than thirty days. Ms. Sanders testified under oath that she notified Triple M's carrier within 30 days of the inception of the work at the Gulf Breeze Parkway site. A letter to the Department of Financial Services signed by Dwain and Celina Sanders on behalf of Triple M, dated June 24, 2004, asserted that Triple M had just begun working in Florida, for the first time in 2004, the week that Ms. Krossman entered the work site. Triple M has been in business for 22 years and has never been bankrupt. Triple M has 401K plans for its employees as well as health insurance. Triple M would have difficulty paying the fine proposed by the Division. Triple M believed its workers were covered by workers' compensation insurance and they were covered. The parties agree that American Home Assurance Company is authorized to write insurance in Florida.
Recommendation Based upon the Findings of Fact and Conclusions of Law, it is, RECOMMENDED that the Division of Workers' Compensation affirm the Stop-Work Order issued to Petitioner on June 4, 2004, and assess a fine of $36,521.61. DONE AND ENTERED this 13th day of January, 2005, in Tallahassee, Leon County, Florida. S HARRY L. HOOPER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of January, 2005. COPIES FURNISHED: Joe Thompson, Esquire Department of Financial Services Division of Workers' Compensation 200 East Gaines Street Tallahassee, Florida 32399 Dwain Sanders Triple M Enterprises, Inc. 24393 North 71 Robertsdale, Alabama 36567 Honorable Tom Gallagher Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Pete Dunbar, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
The Issue The issues are whether Respondent violated Sections 440.10 and 440.38, Florida Statutes (1997), by not securing workers' compensation insurance for its Florida employees; and if so, whether Petitioner properly issued a Stop Work Order and assessed civil penalties pursuant to Sections 440.107(5) and 440.107(7), Florida Statutes (Supp. 1998).
Findings Of Fact Petitioner is the state agency that is charged with the responsibility of enforcing the statutory requirements for employers to provide their employees with workers' compensation coverage. Respondent is a business, located in Savannah, Georgia, that supplies workers on a temporary basis to client businesses. The services that Respondent provides to its client businesses include the payment of payroll, taxes, and workers' compensation insurance for the temporary employees. American Interstate Insurance Company (AIIC) provided Eastern Personnel Services II, Federal Employers Identification Number (FEIN) 58-2340211, with workers' compensation insurance from November 18, 1997, through November 18, 1998, in the state of Georgia. AIIC's policy number 97WAGA1109996 did not provide coverage for any of Respondent's workers in Florida. AIIC is not authorized in Florida to write insurance for an employer with Respondent's assigned risk classification. Safeco Insurance Company of America (SICA) provided Respondent, FEIN 58-2340211, with workers' compensation insurance from December 29, 1998, through December 29, 1999, in the states of Georgia and South Carolina only. SICA's policy number WC7260735 as originally drafted, and as it existed on March 2, 1999, did not provide coverage for any workers in Florida. Paul Day is Respondent's president and sole officer and shareholder. He is also the owner of Eastern Personnel Services II, a sole proprietorship. According to AIIC's and SICA's insurance policies, both entities have the same FEIN. The record here indicates that there is no substantive difference between Respondent and Eastern Personnel Services II. Respondent's testimony to the contrary is not persuasive. 1/ For all practical purposes, Respondent and Eastern Personnel Services II were under the exclusive management and control of Mr. Day at all relevant times. Beginning as early as August 28, 1997 and continuing through March 2, 1999, Respondent provided employees to Foley & Associates Construction Co., Inc. (Foley) at one or more work sites on Amelia Island, Florida. Respondent did not secure workers' compensation insurance for these workers. Stanley Benner was one of the first of Respondent's employees to begin working at Foley's Amelia Island job site. On November 9, 1998, Mr. Benner was injured while working for Respondent. Mr. Benner filed a workers' compensation claim against Respondent and AIIC seeking compensation for his injuries. He subsequently learned that AIIC did not provide workers' compensation insurance for Respondent in Florida. Mr. Benner has received no compensation from Respondent or any insurance carrier for his work-related injury. On March 2, 1999, Mr. Benner's attorney filed a complaint with Petitioner regarding Respondent's lack of workers' compensation coverage. Robert Lambert, Petitioner's investigator immediately went to Foley's job site to investigate the complaint. Upon his arrival at the construction site, Mr. Lambert learned that Respondent had 21 employees performing general contract labor for Foley that day. Foley's office manager informed Mr. Lambert that Respondent had provided Foley with between 15 and 20 laborers per day for one year. Next, Mr. Lambert called Mr. Day who provided a certificate of insurance from SICA by facsimile transmission. However, the certificate listed Saxon and Associates, a business located in Georgia, as the certificate holder. It did not reference coverage for employees provided to Foley in Florida. Mr. Lambert then called Linda Burtchett of HGI, Inc. She is an insurance agent and the authorized representative of SICA. HGI, Inc. is the producer of SICA's policy number WC7260735. Ms. Burtchett informed Mr. Lambert that SICA's policy number WC7260735 did not cover Respondent's employees in the state of Florida. To her knowledge, Respondent had never reported any wages on a Florida payroll. Mr. Lambert issued a Stop Work Order dated March 2, 1999. The Stop Work Order required Respondent to immediately cease all work at the Foley construction site. It advised Respondent that a civil penalty in the amount of $100 would be assessed for each day that it failed to provide the required workers' compensation coverage. Later on March 2, 1999, Respondent requested HGI, Inc. to provide coverage for its Florida employees working at the Foley job site under SICA's policy number WC7260735. HGI, Inc. complied with Respondent's request. Accordingly, Petitioner correctly assessed Respondent with a civil penalty in the amount of $100 in conjunction with the Stop Work Order. Mr. Day testified that the endorsement to the SICA policy provided coverage for Respondent's Florida employees retroactive to September 29, 1998. He also testified that another of Respondent's Florida employees was injured at the Foley construction site on January 18, 1999, and received compensation under the SICA policy. Mr. Day's testimony is not credited in light of Ms. Burtchett's testimony. On March 2, 1999, Petitioner informally requested Respondent to provide business records to establish the value of its Florida payroll during the three years before Petitioner issued the Stop Work Order. Respondent refused to provide Petitioner with any payroll records. Petitioner obtained records maintained by Foley regarding Respondent's employment activities at the Amelia Island job site. Foley's records showed the number of employees that Respondent employed, the number of hours worked by each employee, and their hourly rate of pay. Respondent admitted and Foley's records confirmed that Respondent's payroll at the Foley construction site was $209,249.86 between January 5, 1998 and March 1, 1999. The National Council of Compensation Insurance (NCCI) classifies Respondent as a temporary labor service. According to the NCCI, the employment activities conducted by Respondent's employees at the Foley construction site have an assigned insurance premium rate in the conservative amount of $22.34 for each $100 of payroll. Therefore, Respondent's evaded insurance premium on a payroll of $209,249.86 is $46,746. The administrative penalty is twice the evaded premium of $46,746 or $93,492. On March 31, Petitioner properly issued a Notice and Penalty Assessment Order requiring Respondent to pay an administrative penalty in the amount of $93,492. Respondent's untimely discovery responses indicated that its Florida payroll was $196,701.62 in 1998 and $65,165.36 in 1999. Petitioner could have assessed Respondent with an administrative penalty in the amount of $115,743.26.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That Petitioner enter a final order affirming the Stop Work Order and Notice and Penalty Assessment Order with their associated penalties, plus any lawful interest. DONE AND ENTERED this 12th day of October, 1999, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 12th day of October, 1999.
Other Judicial Opinions A party who is adversely affected by this order closing file 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 Department of Management Services, 4050 Esplanade Way, Suite 160, Tallahassee, Florida 32399-0950, 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. CERTIFICATE OF SERVICE I HEREBY CERTIFY that this Order Closing File was filed in the official records of the Department of Management Services and copies were furnished to: Larry D. Scott, Assistant General Counsel, Department of Management Services, 4050 Esplanade Way, Suite 160, Tallahassee, Florida 32399-0950; Jane M. Letwin, Esquire, 5426 SW 25" Avenue, Fort Lauderdale, Florida 33312, and Judge Claude B. Arrington, Division of Administrative Hearings, the DeSoto net Building, 1230 Apalachee Parkway, Tallahassee, Florida 32399-3060, this | a day of Quis, Us? ‘ , 2009. Debbie Shoup Clerk Department of Management Services (850) 487-1082 2 of 2 Jul 11 2009 11:41 a7/11/2889° 12:23 9549617454 PACK-SHIP&BEYOND PAGE 91/03 STATE OF FLORIDA DIVISION OF ADMINISTRATIVE HEARINGS GLORIA MARSHALL, Petitioner CASE NO: 08-3716 JUDGE ARRINGTON v. DEPARTMENT OF MANAGEMENT SERVICES, DIVISION OF RETIREMENT. Respondent. / PETITIONER’S AMENDED NOTICE OF VOLUNTARY DISMISSAL WITHOUT PREJUDICE PETITIONER, GLORIA MARSHALL, through undersigned counsel, hereby files this AMENDED PETITIONER’S NOTICE OF VOLUNTARY DISMISSAL WITHOUT PREJUDICE, on the following grounds: 1. Petitioner Marshall is not working for the employer since June of 2008, when she retired after a long career as an employee of the Broward County School Board. Most of the documents to be used in this petition are already in possession of Respondent and the attorney for Petitioner. 2. Petitioner patiently and conscientiously worked as an adult ed teacher from 1981 through 2005, a period of some twenty four years. EXHIBIT att Jul 11 2009 11:41 @7/11/2889 12:23 9549617454 PACK-SHIP&BEYOND PAGE 62/83 3. In view of the relationship between the Repondent and Petitioner, who has been enrolled several times in the FRS, Petitioner contends that the Respondent exercise its fiduciary duty to act in the best interests of the member by not opposing this dismissal without prejudice. 4. Petitioner contends that no prejudice to Respondent will result. 5. No expenses have been incurred thus far other than the transmission of employment records by the Respondent to undersigned counsel, and those will not change. If a plan has been proposed for the case by Respondent, that plan can be laid aside and will serve the same purpose in the future. 6. In light of the circumstances which prevail, to insist on the prosecution of this petition at this time will not serve the interests of justice. 7. Petitioner has indicated that she is unable to assist in this petition until the month of December 2009. 8, In addition, the goal sought in these proceedings is a very precious one, that is, a pension and social security fund which will influence the comfort or lack thereof of this petitioner’s last years, and is worthy of the Court’s indulgence in acknowledging this dismissal without prejudice. BASED ON THE FOREGOING recitation of facts, Petitioner files this ‘ Amended Notice of Voluntary dismissal without prejudice. Jul 11 2009 11:42 97/11/2009 12:23 9549617454 PACK-SHIP&BEYOND PAGE 43/03 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true copy of the foregoing has been fax-filed with the Department of Administrative Hearings and e-mailed to 850 922 6312, to Larry Dz. Scott, Esq., Asst. General counsel to DMS, 4050 Esplanade Way, Suite 160, Tallahassee, Florida 32399-0950 Eleventh day of July, 2009. LAW OFFICE OF JANE M. LETWIN Attorney for Petitioner: Florida Bar Number 990329 5426 SW 25" Avenue, Fort Lauderdale Fl 33312 Phone: 954 245 8495: Fax: 954 301 8401 E-mail; Janeletwintv@aol.com By * ou Jane M. Letwin
