Findings Of Fact 10. The factual allegations contained in the Stop-Work Order and Order of Penalty Assessment issued on February 17, 2009, the Amended Order of Penalty Assessment issued on May 19, 2009, and the 2nd Amended Order of Penalty Assessment issued on June 5, 2009, which are fully incorporated herein by reference, are hereby adopted as the Department’s Findings of Fact in this case.
Findings Of Fact 12. The factual allegations in the Stop-Work Order and Order of Penalty Assessment issued on February 17 2009, and the Third Amended Order of Penalty Assessment issued on September 4, 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 Financial 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 Third Amended Order of Penalty Assessment served in Division of Workers’ Compensation Case No. 09-042-D7, and being otherwise fully advised in the premises, hereby finds that: 1. On February 17, 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. 09-042-D7 to ROYMO, INC. The Stop-Work Order and Order of Penalty Assessment included a Notice of rights wherein ROYMO, INC. was advised that any request for an administrative proceeding to challenge or contest the Stop-Work Order and Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Stop-Work Order and Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 2. On February 17, 2009, the Stop-Work Order and Order of Penalty Assessment was served via personal service on ROYMO, 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 February 25, 2009, the Department issued an Amended Order of Penalty Assessment to ROYMO, INC. in Case No. 09-042-D7. The Amended Order of Penalty Assessment assessed a total penalty of $61,692.98 against ROYMO, INC. The Amended Order of Penalty Assessment included a Notice of Rights wherein ROYMO, INC. was advised that any request for an administrative proceeding to challenge or contest the Amended Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Amended Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 4. The Amended Order of Penalty Assessment was served on ROYMO, INC. by personal service on February 25, 2009. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 5. On March 10, 2009, ROYMO, INC. filed a timely Petition for a formal administrative hearing in accordance with Sections 120.569 and 120.57, Florida Statutes. The Petition was forwarded to the Division of Administrative Hearings and assigned Case No. 09- 1388. 6. On September 4, 2009, the Department issued a Third Amended Order of Penalty Assessment to ROYMO, INC. in Case No. 09-042-D7. The Third Amended Order of Penalty Assessment assessed a total penalty of $29,911.26 against ROYMO, INC. The Third Amended Order of Penalty Assessment was served on ROYMO, INC. through the Division of Administrative Hearings. A copy of the Third Amended Order of Penalty Assessment is attached hereto as “Exhibit C” and is incorporated herein by reference. 7. On November 6, 2009, ROYMO, INC. filed a Notice of Voluntary Dismissal in DOAH Case No. 09-1388. A copy of the Notice of Voluntary Dismissal filed by ROYMO, INC. is attached hereto as “Exhibit D.” 8. On November 9, 2009 Administrative Law Judge Daniel M. Kilbride entered an Order Closing File, relinquishing jurisdiction to the Department. A copy of the November 9, 2009 Order Closing File is attached hereto as “Exhibit E.”
The Issue The issue in this case is whether Respondent violated the provisions of chapter 440, Florida Statutes, by failing to secure the payment of workers' compensation, as alleged in the Stop-Work Order and 3rd Amended Order of Penalty Assessment, and, if so, what penalty is appropriate.
Findings Of Fact Petitioner, Department of Financial Services, Division of Workers' Compensation, is the state agency responsible for enforcing the requirement that employers in the State of Florida secure the payment of workers' compensation for their employees and corporate officers. Respondent, Shriji Krupa, Inc., is a Florida corporation engaged in business operations as a gas station (self-service and convenience-retail) in the State of Florida. Mr. Hemant Parikh, one of Respondent's corporate officers, testified that, on November 20, 2012, Respondent was inspected by Petitioner's Compliance Investigator, Mike Fuller. Mr. Fuller advised Mr. Parikh that Respondent needed to close the store. According to Mr. Hemant Parikh, at the time of inspection, Respondent had two corporate officers and four additional employees. Mr. Parikh explained that, at the time of inspection, Respondent had two store locations with three employees working at each locale. Mr. Shrikant Parikh, another corporate officer, testified that, at the time of inspection, Respondent was operating under the mistaken belief that its corporate officers were exempt from workers' compensation coverage. Pursuant to the record evidence, on November 28, 2012, Mr. Fuller served a Stop-Work Order and Order of Penalty Assessment on Respondent. Pursuant to the Stop-Work Order, Respondent was ordered to cease all business operations for all worksites in the state based on the following: Failure to secure the payment of workers' compensation in violation of sections 440.10(1), 440.38(1), and 440.107(2) F.S., by: failing to obtain coverage that meets the requirements of Chapter 440, F.S., and the Insurance Code. After receiving the Stop-Work Order, on that same date, Respondent obtained workers' compensation coverage with an effective date of November 29, 2012. Respondent has maintained appropriate coverage to date. Following the Stop-Work Order, Respondent submitted various records for Petitioner's review.2/ Petitioner's sole witness was Ms. Lynne Murcia. Ms. Murcia works in Petitioner's Bureau of Compliance wherein she calculates penalties for those employers found in violation of the workers' compensation laws. Ms. Murcia performs approximately 200 penalty calculations per year. Ms. Murcia first became involved with Respondent in January 2013, when she received an assignment to perform a penalty calculation. Ms. Murcia reviewed all records previously submitted by Respondent. From the records received, Ms. Murcia was able to determine that Respondent employed four or more employees on a regular basis. Ms. Murcia explained that "employees" include corporate officers that have not elected to be exempt from workers' compensation. After conducting a search within the Florida Division of Corporations, Ms. Murcia was able to determine that no exemptions existed for Respondent's corporate officers. Ms. Murcia further conducted a proof of coverage search via Petitioner's Coverage and Compliance Automated System ("CCAS"), which is a database that contains all insurance coverage and exemptions for each employer throughout the State of Florida. The search revealed that Respondent possessed appropriate coverage from November 29, 2012, to the present; however, no prior coverage was indicated. Ms. Murcia conducted a penalty assessment for the non- compliance period of November 29, 2009, through November 28, 2012. From the records submitted by Respondent, Ms. Murcia correctly identified Respondent's employees and gross wages paid during the penalty period. All of the individuals listed on the Penalty Worksheet of the 3rd Amended Order of Penalty Assessment, dated August 27, 2014, were "employees" (as that term is defined in section 440.02(15)(a), Florida Statutes) of Respondent during the period of noncompliance listed on the penalty worksheet. From a description of the Respondent's business operations, Ms. Murcia determined Respondent's classification code. She explained that classification codes are established by the National Council of Compensation Insurance ("NCCI"). A classification code is a four-digit code number that is assigned to a specific group of tasks, duties, and responsibilities for a specific grouping of business. Ms. Murcia further testified that the classification codes are associated with a manual rate which is the actual dollar amount of risk associated with a particular code.3/ The manual rates are also established by NCCI. Class Code 8061, used on the penalty worksheet attached to the 3rd Amended Order of Penalty Assessment, and as defined by the NCCI Scopes Manual, is the correct occupational classification for Respondent. From the assigned classification code number, 8061, Ms. Murcia calculated the appropriate manual rate for the penalty period. The manual rates used on the penalty worksheet attached to the 3rd Amended Order of Penalty Assessment are the correct manual rates. The total penalty of $21,205.19 is the correct penalty for the employees listed on the penalty worksheet attached to the 3rd Amended Order of Penalty Assessment.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services, Division of Workers' Compensation, enter a final order determining that Respondent Shriji Krupa, Inc., violated the requirement in chapter 440, Florida Statutes, to secure workers' compensation coverage, and imposing a total penalty assessment of $21,205.19. DONE AND ENTERED this 30th day of October, 2014, in Tallahassee, Leon County, Florida. S TODD P. RESAVAGE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of October, 2014.
The Issue The issue is whether the Stop-Work Order and 2nd Amended Order of Penalty Assessment issued by Petitioner, Department of Financial Services, Division of Workers' Compensation (Department), on July 1, 2015, and February 29, 2016, respectively, should be upheld.
Findings Of Fact The Department is the state agency responsible for enforcing the various requirements of chapter 440. Respondent is a Florida corporation with offices located at 1904 28th Avenue North, St. Petersburg, Florida. The company is engaged in the construction business, and its activities fall within the statutory definition of "construction industry." See § 440.02(8), Fla. Stat. Respondent also does business under the name of M & M Construction of South Florida, but both are the same corporate entity with the same Federal Employer Identification Number and use the same bank accounts. Respondent's assertion that the two are separate and work done under the "d/b/a" name cannot be used to establish liability under chapter 440 is rejected. On July 1, 2015, Munal Abedrabbo, a Department compliance inspector, made a random inspection of a job site at 4115 East Busch Boulevard, Tampa, where remodeling work on a commercial building was being performed. When he entered the premises, Mr. Abedrabbo observed Bernard Reed on a ladder painting an interior ceiling. After identifying himself, he informed Mr. Reed that he needed to verify his insurance coverage. Mr. Abedrabbo was directed to Mr. Cook, Respondent's vice-president and part owner, who acknowledged that he was the general contractor on the job and had three employees/painters working that day, Reed, James Dabnes, and John Russell. Mr. Cook informed the inspector that the three employees were leased from Paychek, Inc., an employee leasing company, and that firm provided workers' compensation coverage for the leased employees. Mr. Abedrabbo returned to his vehicle and accessed on his computer the Department of State, Division of Corporations, Sunbiz website to verify Respondent's status as a corporation. After verifying that it was an active corporation, he then checked the Department's Coverage and Compliance Automated System to verify whether Respondent had a workers' compensation policy or any exemptions. He was unable to find any active policy for Respondent, as the most recent policy had lapsed in January 2013. Mr. Cook has an exemption, covering the period October 20, 2014, through October 19, 2016, but the exemption is with a different company, Thomas Cook Carpenter, LLC. Mr. Abedrabbo spoke again with Mr. Cook and informed him that Department records showed no insurance coverage for his employees. Mr. Cook telephoned Paychek, Inc., and then confirmed that the three painters had no workers' compensation insurance. Mr. Cook explained that before he allowed Mr. Reed to begin work, Mr. Reed had shown him an insurance certificate that turned out to be "falsified," and then "conveniently lost it" when the inspector appeared. He also explained his firm "was caught with our pants down once before" and he did not want it to happen again. For that reason, he contended he was especially careful in hiring leased employees. Even so, he does not deny that Respondent has had no insurance in place since January 2013 and Paychek, Inc., failed to provide coverage. The Department issued a Stop Work Order and Penalty Assessment the same day. To determine the amount of Respondent's unsecured payroll for purposes of assessing a penalty in accordance with section 440.107(7)(d)(1), Florida Statutes, the Department requested Respondent to provide business records for the preceding two years. This period of non-compliance is appropriate, as Respondent was actively working in the construction industry during that time period without securing insurance. The request informed Mr. Cook that if complete records were not provided, the Department would use the imputation formula found in section 440.107(7)(e) to calculate the penalty. After reviewing the information provided by Respondent, on August 18, 2015, the Department issued an Amended Order of Penalty Assessment in the amount of $114,144.52 for the period July 7, 2014, through June 30, 2015. Based on two depositions of Mr. Cook, a 2nd Amended Order of Penalty Assessment in the amount of $105,663.48 was issued on February 29, 2016. The Department penalty auditor calculated the final penalty assessment using the "imputed" method because insufficient business records were provided to determine Respondent's payroll for all relevant time periods, except the month of October 2014. In addition to missing bank statements and check images, Respondent failed to provide its entire second bank account. Although Mr. Cook contends some records were in the possession of M & M Construction of South Florida, and he could not access them in a timely manner, this does not excuse Respondent's failure to timely produce all relevant records. Under the imputed method, the penalty auditor used the average weekly wage ($841.57) times two to determine Respondent's payroll for the imputed portions. See Fla. Admin. Code R. 69L-6.028(2); § 440.107(7)(e), Fla. Stat. The gross payroll was then divided by 100 in order to be multiplied by the applicable approved manual rates. The Department applied the proper methodology in computing the penalty assessment. A class code is a numerical code, usually four digits, assigned to differentiate between the various job duties or scope of work performed by the employees. The codes were derived from the Scopes Manual Classifications (Manual), a publication that lists all of the various jobs that may be performed in the context of workers' compensation. The Manual is produced by the National Council on Compensation Insurance, Inc., an authoritative data collecting and disseminating organization for workers' compensation. The Manual provides that class code 5474 applies to painters who perform painting activities. Reed, Dabnes, and Russell were assigned this code. Mr. Cook agrees this code is correct. Mr. Cook was assigned class code 5606 (construction executive) and placed on the penalty assessment because he is an owner of the corporation and was managing the work. Although Mr. Cook argues he had an exemption and should not be placed on the assessment, Department records reflect that Mr. Cook had an exemption with a different company during the audit period. Therefore, his inclusion in the employee census was correct. Because Respondent's business records included checks written to Kerry Francum for tile work, he was assigned class code 5348 (tile work) and placed on the penalty assessment as an employee. At his deposition, Mr. Cook acknowledged that Francum performed tile work for his firm and was an employee. At hearing, Mr. Cook changed his testimony and contended Francum was only a material supplier, not a subcontractor, and should not be on the penalty assessment. This assertion has not been accepted. Mr. Francum's inclusion on the assessment is appropriate. Respondent's business records also indicated a check was written to Kerry Randall, a tile subcontractor. At hearing, however, Mr. Cook established, without contradiction, that because of Mr. Randall's violent temper, he was paid a one-time fee of $1,000.00 and let go before he performed any work. Mr. Randall should be removed from the assessment. The Department has demonstrated by clear and convincing evidence that the 2nd Amended Order of Penalty Assessment is correct, less any amount owed for Mr. Randall.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services enter a final order assessing Respondent the penalty in the 2nd Amended Order of Penalty Assessment, less any amount owed for Mr. Randall. DONE AND ENTERED this 21st day of November, 2016, in Tallahassee, Leon County, Florida. S D. R. ALEXANDER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 21st day of November, 2016.
Findings Of Fact 11. The factual allegations contained in the Stop-Work Order and Order of Penalty Assessment issued on March 12, 2009, and the Amended Order of Penalty Assessment issued March 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 Financial 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 Order of Penalty Assessment served in Division of Workers’ Compensation Case No. 09-075-1A, and being otherwise fully advised in the premises, hereby finds that: 1. On March 12, 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. 09-075-1A to REGIONAL CONCRETE, INC. The Stop-Work Order and Order of Penalty Assessment included a Notice of Rights wherein REGIONAL CONCRETE, INC. was advised that any request for an administrative proceeding to challenge or contest the Stop-Work Order and Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Stop-Work Order and Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 2. On March 12, 2009, the Stop-Work Order and Order of Penalty Assessment was served by personal service on REGIONAL CONCRETE, 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 30, 2009, the Department issued an Amended Order of Penalty Assessment to REGIONAL CONCRETE, IN C. in Case No. 09-075-1A. The Amended Order of Penalty Assessment assessed a total penalty of $122,034.51 against REGIONAL CONCRETE, INC. The Amended Order of Penalty Assessment included a Notice of Rights wherein REGIONAL CONCRETE, INC. was advised that any request for an administrative proceeding to challenge or contest the Amended Order of Penalty Assessment must be filed within twenty- one (21) days of receipt of the Amended Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 4. On April 1, 2009, the Amended Order of Penalty Assessment was served by certified mail on REGIONAL CONCRETE, INC. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 5. On April 20, 2009, REGIONAL CONCRETE, INC. filed a petition requesting a formal administrative hearing with the Department. The Department forwarded the petition to the Division of Administrative Hearings on June 8, 2009, and the matter was assigned DOAH Case No. 09-3046. 6. On July 24, 2009, the Department served its discovery requests on REGIONAL CONCRETE, INC., which included interrogatories, requests for admissions, and requests for production. Responses or objections to the discovery were required to be served on the Department within thirty days. REGIONAL CONCRETE, INC. failed to respond to the discovery requests within thirty days. 7. On August 28, 2009, the Department filed a Motion to Compel Discovery. The Honorable P. Michael Ruff, the Administrative Law Judge, entered an Order on Motion to Compel on September 15, 2009, which required REGIONAL CONCRETE, INC. to serve responses to the requests for admission, interrogatories, and requests for production no later than September 18, 2009. 8. On September 25, 2009, the parties filed a Joint Response to Order Granting Continuance wherein the parties agreed REGIONAL CONCRETE, INC. would submit to the Department responses to the discovery requests by October 23, 2009. Since conferring on the Joint Response to Order Granting Continuance, the Department has made several unsuccessful attempts to reach REGIONAL CONCRETE, INC. 9. On November 3, 2009, the Department filed a Motion to Deem Matters Admitted and to Relinquish Jurisdiction Pursuant to Section 120.57(1)(i), Florida Statutes, with the Division of Administrative Hearings after REGIONAL CONCRETE, INC. failed to respond to the discovery request by. October 23, 2009. A hearing on the motion was held on November 20, 2009, during which several’ unsuccessful attempts were made to contact REGIONAL CONCRETE, INC. The Department also attempted to contact REGIONAL CONCRETE, INC. by telephone after the hearing on the motion, but was unsuccessful. After the hearing on the motion, the Honorable James H. Peterson, III, the Administrative Law Judge, entered an Order to Show Cause which ordered REGIONAL CONCRETE, INC. to show good cause within seven days as to why the Motion to Deem Matters Admitted and to Relinquish Jurisdiction Pursuant to Section 120.57(1)(@, Florida Statutes, should not be granted. A copy of the Order to Show Cause is attached hereto as “Exhibit C” and incorporated herein by reference. 10. On December 3, 2009, the Honorable James H. Peterson, II, entered an Order Closing File deeming the admissions contained in the discovery requests admitted. The Order Closing File further concluded that there were no disputed issues of material fact and relinquished jurisdiction of the matter to the Department for final disposition. A copy of the Order Closing File is attached hereto as “Exhibit D” and incorporated herein by reference.
The Issue Has Respondent failed to secure payment of workers' compensation for his employees, Section 440.107(2), Florida Statutes (2005), justifying the entry of a stop-work order, Subsection 440.107(7)(a), Florida Statutes (2005), and the entry of a financial penalty against Respondent, Subsection 440.107(7)(d), Florida Statutes (2005), as imputed, Subsection 440.107(7)(e), Florida Statutes (2005)?
Findings Of Fact Michael Robinson is an investigator for Petitioner's Bureau of Compliance. His duties include job site visits to determine whether individuals on the site are employees, by whom those persons are employed and whether the employer has secured the payment of workers' compensation by obtaining necessary insurance coverage. Some site visits are made on a random basis. That was the case here. On August 11, 2005, Mr. Robinson went to an address in Lake City, Florida, referred to as 223 NW Sylvi Drive. There he observed three individuals laying sod in the yard of the private residence located at the address. Respondent, a fourth individual, was transporting sod from a trailer to the yard using equipment described as a Bobcat. The sod had been cut in squares and the squares were being matched and placed on the ground in the yard, where it was stepped on to secure it in the ground in a checker board pattern. Approximately three-quarters of the yard had sod placed. Mr. Robinson considered the activities on the site as involving a construction industry, with a classification, according to the National Council on Compensation, Inc. (NCCI), as class code 0042, landscape gardening and drivers, as reflected in Florida Administrative Code Rule 69L-6.021(1)(a). The NCCI classification codes for job descriptions were adopted by the rule. Mr. Robinson observed a permit board erected in the front yard of the property. There was no evidence that he saw which would indicate anyone was living in the home. The garage door was open. There was nothing in the garage. No blinds were on the windows. No evidence of any kind was observed that would indicate the house had been occupied. Altogether four persons were working at the site. Mr. Robinson interviewed each individual. After introducing himself, Mr. Robinson explained to Respondent the reason for the site visit and determined that Respondent was the employer for the other individuals, in addition to working on the job. Respondent told Mr. Robinson that he was a sub-contractor working for Earth Scapes, and had been hired to lay new sod in the yard. Respondent described his position as that of a sole proprietor. Respondent identified two of the other individuals as being his step-sons and the remaining individual was a family friend. Respondent explained that the basis for compensating the other employees was that Respondent "gave them running around money on Friday's." The other individuals indicated that they worked for Respondent part-time when he needed their help. To verify Respondent's statement that he was a sub- contractor assigned to the job, Mr. Robinson contacted the owner of Earth Scapes, who agreed with Respondent's recount of his assignment at the job location. Mr. Robinson was told Earth Scapes is a nursery that lays new sod and plants trees. Mr. Robinson inquired of Mr. Curry concerning workers' compensation coverage for the three employees. The answer was that Respondent did not have workers' compensation coverage through an insurance policy or through a leasing company or temporary labor service. Research into coverage and compliance through a Coverage and Compliance Automated System (CCAS) data base available to Petitioner did not reveal any information concerning Respondent and his business at 1259 SW County Road, 252-B, Lake City, Florida, that would relate to workers' compensation coverage. A similar search of a data base maintained by Petitioner in association with exemptions from the requirement to obtain workers' compensation coverage did not reveal any exemption for Respondent from the need for workers' compensation coverage. Having discovered the activity on the construction site in which work was done without workers' compensation coverage, Mr. Robinson discussed his findings with Robert Lambert, Petitioner's district supervisor in the Bureau of Compliance. Following that conversation Mr. Lambert authorized Mr. Robinson to issue a stop-work order to Respondent. A stop- work order was prepared on August 11, 2005. The stop-work order was served on Respondent on that date. The basis for its entry was the failure to secure payment of workers' compensation in violation of Section 440.107(2), Florida Statutes (2005), by failing to obtain coverage that would meet the requirements set forth in Chapter 440, Florida Statutes, and provisions of the Florida Insurance Code (the Insurance Code). On that same date, an Order of Penalty Assessment was served on Respondent under authority set for in Section 440.107(7)(d), Florida Statutes (2005). The Order of Penalty Assessment also reminded Respondent that the penalty might be amended based upon other information obtained, including the production of business records held by Respondent. These orders advised Respondent that he had the right to contest material facts in the stop-work order by filing a written petition for hearing under Sections 120.569 and 120.57, Florida Statutes (2005). On August 11, 2005, by a written document, Mr. Robinson requested production of business records maintained by Respondent that would assist in the calculation of a penalty assessment for the period August 11, 2002, through August 11, 2005, as contemplated by Section 440.107(7), Florida Statutes. The written request for production reminded Respondent that he must produce those records within five business days after receipt, to allow examination and copying, and that the failure to do so by quality of information sufficient to allow the determination of the payroll for the period in question, would allow the Petitioner to impute weekly payroll for the three employees and Respondent pursuant to the information derived using Section 440.12(2), Florida Statutes (2005), multiplied by 1.5. The document served on Respondent set out the various categories of information requested for production. These categories comport with Florida Administrative Code Rule 69L- 6.015. Respondent did not honor this request at any time.2/ Mr. Robinson not only provided the list of categories of information sought for production, he explained the categories found on the list to Respondent. Examples of information sought and explained included timesheets, time cards, payroll check stubs, check ledgers, income tax returns that would reflect the amount of remuneration paid or payable to each employee. On September 1, 2005, Mr. Robinson served Respondent with an Amended Order of Penalty Assessment that set forth an assessed penalty of $121,039.00, by imputation under Subsection 440.107(7)(d) and (e), Florida Statutes (2005), and by resort to Florida Administrative Code Rule 69L-6.028. That rule allows the imputation of payroll calculations after 15 business days following receipt by the employer of a written request to produce business records and the method will not be set aside after 45 days from receipt. The Amended Order of Penalty Assessment reminded Respondent that the stop-work order would remain in effect unless that order was released by Petitioner's further order. The necessary steps to set aside the stop-work order depended on obtaining coverage under the workers' compensation law and the payment of the penalty assessment. The approach for serving the Amended Order of Penalty Assessment was by certified mail return receipt requested. The receipt was returned following service. The Amended Order of Penalty Assessment provided the Respondent with the opportunity to dispute the material facts associated with the Amended Order of Penalty Assessment under procedures found in Sections 120.569 and 120.57, Florida Statutes (2005). As indicated, Respondent took advantage of the right to contest matters leading to the final hearing. The Amended Order of Penalty Assessment as set forth in Petitioner's Exhibit number six also reflects a worksheet that applies to the overall period in question. It demonstrates the calculations imputed related to Respondent, Tony Joe Brown, Collin Grimes, and Josh Grimes, persons on the job site when the random inspection took place on August 11, 2005. The calculations in the matrix for all parts, were in relation to the four workers under class code 0042, without the benefit of actual information provided by Respondent. The job class codes are derived from the Scopes Manual, an insurance industry publication.
Recommendation Upon the consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That a Final Order be entered keeping the stop-work order in effect pending Respondent's proof that he has obtained necessary workers' compensation coverage and the payment of the Amended Penalty Assessment in the amount of $121,039.00. DONE AND ENTERED this 28th day of June, 2006, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS 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 28th day of June, 2006.
Findings Of Fact 11. — The factual allegations in the Stop-Work Order and Order of Penalty Assessment issued on February 3, 2009, and the Fourth Amended Order of Penalty Assessment issued on February 5, 2010, 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 Financial 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 Fourth Amended Order of Penalty Assessment served in Division of Workers’ Compensation Case No. 09-014-D2, and being otherwise fully advised in the premises, hereby finds that: 1. On February 3, 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. 09-014-D2 to ASSOCIATED WINDOW AND DOOR, INC. (ASSOCIATED). The Stop-Work Order and Order of Penalty Assessment included a Notice of rights wherein ASSOCIATED was advised that any request for an administrative proceeding to challenge or contest the Stop- Work Order and Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Stop-Work Order and Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 2. On February 3, 2009, the Stop-Work Order and Order of Penalty Assessment was served via personal service on ASSOCIATED. 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 April 10, 2009, the Department issued an Amended Order of Penalty Assessment to ASSOCIATED in Case No. 09-014-D2. The Amended Order of Penalty Assessment assessed a total penalty of $99,761.78 against ASSOCIATED. The Amended Order of Penalty Assessment included a Notice of Rights wherein ASSOCIATED was advised that any request for an administrative proceeding to challenge or contest the Amended Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Amended Order of Penalty Assessment in accordance with Sections 120.569.and 120.57, Florida Statutes. 4. The Amended Order of Penalty Assessment was served on ASSOCIATED by personal service on April 13, 2009. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 5. On April 30, 2009, the Department issued a Second Amended Order of Penalty Assessment to ASSOCIATED in Case No. 09-014-D2. The Second Amended Order of Penalty Assessment assessed a total penalty of $76,081.13 against ASSOCIATED. The Second Amended Order of Penalty Assessment contained a Notice of Rights wherein ASSOCIATED was advised that any request for an administrative proceeding to challenge or contest the Second Amended Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Second Amended Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 6. The Second Amended Order of Penalty Assessment was served on ASSOCIATED by personal service on May 1, 2009. A copy of the Second Amended Order of Penalty Assessment is attached hereto as “Exhibit C” and is incorporated herein by reference. 7. On May 22, 2009, ASSOCIATED filed a timely Petition for a formal administrative hearing in accordance with Sections 120.569 and 120.57, Florida Statutes. The Petition was forwarded to the Division of Administrative Hearings and assigned Case No. 09- 3044. . 8. On February 5, 2010, the Department issued a Fourth Amended Order of Penalty Assessment to ASSOCIATED in Case No. 09-014-D2. The Fourth Amended Order of Penalty Assessment assessed a total penalty of $1,256.24 against ASSOCIATED. The Fourth Amended Order of Penalty Assessment was served on ASSOCIATED through the Division of Administrative Hearings. A copy of the Fourth Amended Order of Penalty Assessment is attached hereto as “Exhibit D” and is incorporated herein by reference. 9. ‘On February 10, 2010, ASSOCIATED filed a Motion to Close File Due to Settlement in DOAH Case No. 09-3044. A copy of the Motion to Close File Due to Settlement filed by ASSOCIATED. is attached hereto as “Exhibit E.” 10. On February 10, 2010, Administrative Law Judge Errol H. Powell entered an Order Closing File, relinquishing jurisdiction to the Department. A copy of the February 10, 2010 Order Closing File is attached hereto as “Exhibit F.”
Findings Of Fact 19. The factual allegations contained in the Stop-Work Order and Order of Penalty Assessment issued on March 25, 2008, the Amended Order of Penalty Assessment issued on April 3, 2008, the 2°4 Amended Order of Penalty Assessment issued on April 11, 2008, the 34 Amended Order of Penalty Assessment issued on July 8, 2008, the 4" Amended Order of Penalty Assessment issued on August 12, 2008, and the 5 Amended Order of Penalty Assessment issued on September 24, 2008, which are attached hereto as Exhibit A, Exhibit B, Exhibit C, Exhibit D, Exhibit E and Exhibit F, respectively, and 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 Financial 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, the Amended Order of Penalty Assessment, the 2"! Amended Order of Penalty Assessment, the 3 Amended Order of Penalty Assessment, the 4" Amended Order of Penalty Assessment and the 5 Amended Order of Penalty Assessment served in Division of Workers’ Compensation Case No. 08-1 17-1A, and being otherwise fully advised in the premises, hereby finds that: 1. On March 25, 2008, the Department of Financial Services, Division of Workers’ Compensation (hereinafter “Department”) issued to JOHN BICKNAS LLC a Stop-Work Order and Order of Penalty Assessment in Division of Workers’ Compensation Case No. 08-117-1A. The Stop-Work Order and Order of Penalty Assessment included.a Notice of Rights wherein JOHN BICKNAS LLC was advised that any request for an administrative proceeding to challenge or contest the Stop-Work Order and Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Stop-Work Order and Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 2. On March 25, 2008, the Stop-Work Order and Order of Penalty Assessment was served by personal service on JOHN BICKNAS LLC. A copy of the Stop-Work Order and Order of Penalty Assessment is attached hereto as “Exhibit A” and incorporated herein by reference. 3. JOHN BICKNAS LLC failed to answer the Stop-Work Order and Order of Penalty Assessment or request a proceeding in accordance with Sections 120.569 and 120.57, Florida Statutes. 4. On April 3, 2008, the Department issued an Amended Order of Penalty Assessment to JOHN BICKNAS LLC in Case No. 08-117-1A. The Amended Order of Penalty Assessment assessed a total penalty of $117,098.93 against JOHN BICKNAS LLC. The Amended Order of Penalty Assessment included a Notice of Rights wherein JOHN BICKNAS LLC was advised that any request for an administrative proceeding to challenge or contest the Amended Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Amended Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 5. On April 3, 2008, the Amended Order of Penalty Assessment was served on JOHN BICKNAS LLC by personal service. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 6. JOHN BICKNAS LLC failed to answer the Amended Order of Penalty Assessment or request a proceeding in accordance with Sections 120.569 and 120.57, Florida Statutes. 7. On April 11, 2008, the Department issued a 2" Amended Order of Penalty Assessment to JOHN BICKNAS LLC in Case No. 08-117-1A. The 2"? Amended Order of Penalty Assessment assessed a total penalty of $59,861.05 against JOHN BICKNAS LLC. 8. On April 11, 2008, the 2"! Amended Order of Penalty Assessment was served on JOHN BICKNAS LLC by personal service. A copy of the 2™4 Amended Order of Penalty Assessment is attached hereto as “Exhibit C” and incorporated herein by reference. 9. On May 2, 2008, JOHN BICKNAS LLC requested a proceeding based upon the 2™ Amended Order of Penalty Assessment, in accordance with Sections 120.569 and 120.57, Florida Statutes. 10. On May 8,-2008, the Department referred the matter to the Division of Administrative Hearings (hereinafter “DOAH”) for appointment of an administrative law judge, who would conduct a formal hearing. The case was assigned DOAH Case No. 08-2236. 11. On July 8, 2008, the Department issued a 3rd Amended Order of Penalty Assessment to JOHN BICKNAS LLC in Case No..08-117-1A. The 3rd Amended Order of Penalty Assessment assessed a total penalty of $74,362.20 against JOHN BICKNAS LLC. 12. On August 12, 2008, the Administrative Law Judge permitted the Department to amend the penalty assessment. As a result, the 3rd Amended Order of Penalty Assessment was entered in this matter. A copy of the 3rd Amended Order of Penalty Assessment is attached hereto as “Exhibit D” and incorporated herein by reference. 13. On August 12, 2008, the Department issued a 4th Amended Order of Penalty Assessment to JOHN BICKNAS LLC in Case No. 08-117-1A. The 4th Amended Order of Penalty Assessment assessed a total penalty of $169,896.64 against JOHN BICKNAS LLC. 14. On August 21, 2008, the Administrative Law Judge permitted the Department to amend the penalty assessment. As a result, the 4th Amended Order of Penalty Assessment was entered in this ection. A copy of the 4"" Amended Order of Penalty Assessment is attached hereto as “Exhibit E” and incorporated herein by reference. 15. On September 24, 2008, the Department issued a 5" Amended Order of Penalty Assessment to JOHN BICKNAS LLC in Case No. 08-117-1A. The 5" Amended Order of Penalty Assessment assessed a total penalty of $20,054.97 against JOHN BICKNAS LLC. 16. On September 25, 2008, this 5 Amended Order of Penalty Assessment was filed in DOAH Case’No. 08-2236. A copy of the 5"" Amended Order of Penalty Assessment is attached hereto as “Exhibit F” and incorporated herein by reference. 17. On September 25, 2008, based upon the 5" Amended Order of Penalty Assessment, JOHN BICKNAS LLC filed a Notice of Withdrawal of Claim in Division of Administrative Hearings case number 08-2236, attached hereto as “Exhibit G” and incorporated herein by reference. | 18. On September 29, 2008, the Administrative Law Judge issued an Order Closing File in Division of Administrative Hearings case number 08-2236, attached hereto as “Exhibit H” and incorporated herein by reference. |
The Issue Whether Respondent has committed the acts alleged in the Stop Work Order and Order of Penalty Assessment and if so, what penalty should be imposed.
Findings Of Fact The Department is the state agency responsible for enforcing the statutory requirement that employers secure workers' compensation insurance for the benefit of their employees. § 440.107, Fla. Stat. On August 11, 2006, Robert Lambert, the Jacksonville District Supervisor for the Division of Workers' Compensation, Bureau of Compliance, was contacted by Katina Johnson, an investigator for the Division.1/ Based on the information provided to him by Ms. Johnson, Mr. Lambert approved the issuance of a Stop Work Order against Capella Ventures, Inc. The investigator served a Stop Work Order and Order of Penalty Assessment, both by posting at the worksite and by hand delivery, on Capella Ventures. The Department investigator also issued a Request for Production of Business Records for Penalty Assessment, requesting records for a period of three years, from July 31, 2003. These records were requested in order to calculate the penalty required pursuant to Section 440.107, Florida Statutes, for not having workers' compensation insurance. The records were to be used in conjunction with the classification codes contained in the Basic Manual (Scopes Manual) published by the National Council on Compensation Insurance. Records were provided by Capella Ventures' counsel. Based on the records provided, an Amended Order of Penalty Assessment was prepared, assessing a penalty of $8,769.16. Mr. Peter King was, at all times material to this case, an officer of Capella Ventures, along with his father. His father is now deceased. Mr. King admitted that workers from Capella Ventures were assisting his father with a construction project on a home next to the home where they lived. He did not dispute that the workers were performing construction work and that the company had no workers' compensation coverage for them at the time. Nor did he dispute the amount of the penalty reflected in the Amended Order of Penalty Assessment. He contended that while his father performed the framing on the property, one of the two other employees did not have the skill to actually perform framing. The class code used by the Department to determine the appropriate penalty was 5645, which is used for carpentry operations on residential structures. Use of this code was appropriate. Capella Ventures filed for an address change in August of 2006, and voluntarily dissolved in January of 2008. No evidence was presented regarding what actions were taken by Capella Ventures with respect to the dissolution of the corporation. No evidence was presented regarding what, if any, distribution of assets was undertaken at the time of dissolution. No evidence was presented to indicate that any successor corporation or entity was formed upon the dissolution of Capella Ventures.
Recommendation Upon consideration of the facts found and conclusions of law reached, it is RECOMMENDED: That a final order be entered finding that Respondent, Capella Ventures, Inc., violated Section 440.107, Florida Statutes, by failing to secure workers' compensation for its employees, and assessing a penalty of $8,769.16. DONE AND ENTERED this 10th day of September, 2008, in Tallahassee, Leon County, Florida. S LISA SHEARER NELSON 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 10th day of September, 2008.
