The Issue Whether Respondent violated the provisions of chapter 440, Florida Statutes (2016), by failing to secure the payment of workers' compensation coverage, as alleged in the Second Amended Order of Penalty Assessment; and, if so, what penalty is appropriate.
Findings Of Fact The Department is the state agency responsible for enforcing the requirement of chapter 440 that employers in Florida secure the payment of workers' compensation coverage for their employees and corporate officers. § 440.107, Fla. Stat. Respondent sells roof coating and provides installation services in the Bradenton, Florida, area. The Investigation On April 20, 2015, the Department received a public referral that Respondent was operating without a roofing license or workers' compensation coverage. The case was assigned by the Department to Compliance Investigator Germaine Green ("Green"). Green first checked the Florida Department of State, Division of Corporations, Sunbiz website to verify Respondent's status as an active corporation. Green then checked the Department's Coverage and Compliance Automated System ("CCAS") to see whether Respondent had a workers' compensation policy or any exemptions. An exemption is a method in which a corporate officer can exempt himself from the requirements of chapter 440. See § 440.05, Fla. Stat. CCAS is the Department's internal database that contains workers' compensation insurance policy information and exemption information. Insurance providers are required to report coverage and cancellation information, which is then input into CCAS. Green's CCAS search revealed that Respondent had no coverage or exemptions during the relevant period. Because Green was not aware of any specific job site at which Respondent was working, she issued a Business Records Request ("BRR") No. 1 to Respondent seeking records for an audit period of January 1, 2015, through April 29, 2015, to determine compliance. Respondent provided payroll records and bank statements. Respondent's president, Felecia Bly ("Bly"), contacted Green and described the nature of the business as a roof coating business that sells a sealant that coats roofs to seal leaks and extend their longevity. Bly explained that Respondent used commissioned salesmen to review the county assessor's website to determine the square footage of a residence. The salesman then contacted property owners to determine whether they experienced leaks and offered the product and installation. The salesmen did not go on the roofs. Respondent considered its salesmen independent contractors to whom they issued IRS Forms 1099. Respondent used subcontractors to perform the installations. According to Respondent, these workers had their own businesses or exemptions. Respondent also used the services of part-time workers for a short period that addressed and sent post cards marketing Respondent's business. Based on her conversation with Bly, Green determined that the business should be categorized as "roofing," which is classified as National Council on Compensation Insurance ("NCCI") class code 5551 and is considered a type of construction activity under Florida Administrative Code Rule 69L-6.021(2)(cc). Green also determined Respondent was non-compliant with the obligation to secure workers' compensation coverage for its workers. The corporate officers did not have exemptions, and several individuals, identified as sales and roofing subcontractors, did not have their own businesses or exemptions and, therefore, were employees. Petitioner did not issue a Stop-work Order because Respondent came into compliance on June 22, 2015, by securing exemptions for the corporate officers. Petitioner issued a BRR No. 5 for additional records from July 1, 2013, through June 21, 2015, to make a penalty calculation for the two-year period of non-compliance. Penalty Calculation The Department assigned Penalty Auditor Christopher Richardson ("Richardson") to calculate the penalty assessed against Respondent. Richardson reviewed the business records produced by Respondent and properly identified the amount of gross payroll paid to Respondent's workers on which workers' compensation premiums had not been paid. Richardson researched Respondent's corporate officers and Respondent's subcontractors to determine those periods when they were not compliant with chapter 440 during the audit period. Richardson determined that Respondent was not compliant for the period of June 22, 2013, through June 21, 2015. Respondent's compliant subcontractors (those with their own workers' compensation insurance or exemptions) were not included in the penalty. The business records ultimately produced by Respondent were sufficient for Richardson to calculate a penalty for the entire audit period. The initial OPA was in the amount of $257,321.16. After receiving and reviewing additional records supplied by Respondent, an Amended OPA was issued in the amount of $51,089.52. After a deposition of Bly's assistant, Sueann Rafalski ("Rafalski"), who provided additional details regarding those individuals and businesses identified in the Amended OPA, a 2nd Amended OPA was issued on July 18, 2016, in the amount of $43,542.16. During the hearing, Respondent disputed a few items that the Department subsequently voluntarily removed in the 3rd Amended OPA. The Department's Motion for Leave to Amend Order of Penalty Assessment was granted on September 29, 2016. Respondent disputed the inclusion of referral fees to Hicks and Campbell, a customer reimbursement payment to Robert Nyilas, payment to House Medic for work done on the Bly's home, and a loan repayment to the Bly's son, Brian Bly. The Department correctly removed any penalties associated with Hicks, Campbell, Robert Nyilas, House Medic, and Brian Bly. The Department also removed $14,200.00 from the penalty that Respondent disputed as repayments toward a $150,000.00 loan from its corporate officers. Respondent continues to dispute the penalty calculation for all others identified in the 3rd Amended OPA, except for the inclusion of the payment to Unexpected Blessings. For the penalty assessment calculation, Richardson consulted the classification codes listed in the Scopes® Manual, which has been adopted by the Department of Financial Services through rules 69L-6.021 and 69L-6.031. Classification codes are assigned to various occupations to assist the calculation of workers' compensation insurance premiums. Richardson assigned the class codes based on information provided by Bly. Richardson then utilized the corresponding approved manual rates for those classification codes and the related periods of non-compliance. Richardson applied the correct approved manual rates and correctly utilized the methodology specified in section 440.107(7)(d)l. and rules 69L-6.027 and 69L-6.028 to determine the penalty. Penalty for the Blys Respondent admits that during the audit period, the business did not carry workers' compensation insurance coverage, and its corporate officers, Glenn and Felecia Bly ("the Blys"), did not have workers' compensation exemptions. Because neither Mr. nor Mrs. Bly was engaged in the application of the roofing materials, the Department correctly assigned class code 8742, for sales and marketing, to them. However, the Department miscalculated the gross income of the Blys. Respondent provided check stubs and its accountant's itemization of payments to the Blys, which constituted repayment of loans from Respondent to the Blys. No evidence to the contrary was presented to indicate these sums were anything other than loan repayments. The Department erroneously included these sums in its calculation of gross payroll to the Blys. Although the Department made a $14,000.00 deduction from gross income for the Blys during this period as "loan repayments," no explanation was provided regarding how this sum was ascertained and why the Department disregarded the information of Respondent's accountant showing repayments during the relevant period in the amount of $19,200.00. The Department obviously accepted the testimony of Bly that, in fact, a portion of what the Department previously concluded was gross income to the Blys, was rather repayments for loans made to Respondent. Accordingly, in the absence of any evidence by the Department of how it parceled out which portion of money paid to the Blys constituted wages and which portion was loan repayments, the Department failed to demonstrate clearly and conclusively that the penalty associated with payments to the Blys is accurate.2/ Penalty for Postcard Mailers Three women, Meghan Saulino, Kimberly Kalley, and Stacy Boettner, were identified by Bly as independent contractors she hired to address and mail postcards for Respondent. According to Bly and Rafalski, these workers were college students who did the work at home, on their own time, and were paid by the job. This arrangement did not last long because the women did not like the work, and the task was transferred to Minuteman, a printing and copying business. These women are included in the Second Amended OPA and are assigned class code 8742 for sales and marketing. Respondent contends they should not be included because they were not employees. No evidence was presented to refute that these three women were merely casual workers whose duties (addressing and mailing postcards) were not in the course of the trade, business, profession, or occupation of Respondent (selling and installing roof coating). Accordingly, the amount included in the penalty for their work, $78.18, should be excluded from the 3rd Amended OPA. Penalty for Commissioned Salesmen Respondent contends that its commissioned sales people are all independent contractors who performed jobs for others. These salespeople included Kevin Kalley, Robert Patton, Gino Barone, Scott De Alessandro, Scott Black, and Tim Paige. However, no evidence was presented of the independent contractor agreements for these individuals, certificates of exemption for them for the penalty period, or evidence that these individuals owned their own businesses. As such, the Department was correct in including the amounts received by the salespeople as gross income for purposes of the penalty calculations. Penalty for Roof Coating Installers Respondent similarly argues that its roof coating installers were independent contractors. The roof coating installers included Bill Boettner, owner of Unexpected Blessings who did not have an exemption during the penalty period, and his business, Unexpected Blessings. Again, no evidence was presented of certificates of exemption for the penalty period or evidence that Unexpected Blessings had coverage. As such, the Department was correct in including the amounts received by the roof coating installers as gross income for purposes of the penalty calculations. Penalty for Other Independent Contractors Respondent argues that Rafalski and Bobby McGranahan ("McGranahan") should not be included in the penalty calculation because they were independent contractors not directly associated with Respondent's business. Rafalski was hired by Bly to help with personal errands and to respond to the audit which serves as a basis for this action. McGranahan is alleged to have run errands for the roof coating installers and acted as a handyman for Respondent before becoming a salesperson for Respondent. It is undisputed that Rafalski and McGranahan performed duties directly related to Respondent's business. Although Rafalski testified at her deposition that she considered herself an independent contractor, it was clear she worked on-site and was the individual most familiar with Respondent's business operations and internal accounting practices. McGranahan's duties, of shopping for supplies for the roofing installers, and then selling for Respondent, were directly related to Respondent's business. No evidence was presented demonstrating that either Rafalski or McGranahan owned their own business or had an exemption. Accordingly, they were properly included in the Department's 3rd Amended OPA.
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 assessing a penalty against Respondent in the amount of $34,552.20. DONE AND ENTERED this 12th day of October, 2016, in Tallahassee, Leon County, Florida. S MARY LI CREASY 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 12th day of October, 2016.
The Issue The issue is whether Petitioner properly issued a Stop Work Order (SWO) and Second Amended Penalty Assessment against Respondent for failing to obtain workers' compensation insurance that meets the requirements of Chapter 440, Florida Statutes.
Findings Of Fact The Division is a component of the Department of Financial Services. It is responsible for enforcing the workers' compensation coverage requirements pursuant to Section 440.107, Florida Statutes. Nobel is a corporation operating as a moving business in Florida. Nobel was incorporated in 2004 and has been operating with an active status since its inception. Yaniv Dalei is the sole owner and president of Nobel. On June 9, 2009, Petitioner's investigator, Cesar Tolentino, visited 18255 Northeast 4th Court, North Miami, Florida ("business site"), after being referred to the location to investigate Respondent for compliance with the Florida Workers' Compensation Law. At the business site, Petitioner's investigator spoke to the manager, and saw the bookkeeper and the receptionist during the visit. Respondent was not at the business site, but was out of the country in Panama when Tolentino visited. Respondent spoke to Tolentino by telephone. Respondent informed Tolentino that he had five employees and that he "was in the process of obtaining workers' compensation insurance." While at the business site, Tolentino, used the Department of Financial Services' Coverage and Compliance Automated System (CCAS), and confirmed Respondent lacked insurance for the payment of workers' compensation coverage. Additionally, Petitioner's investigator verified through the CCAS that Nobel had not secured an employee leasing company to secure workers' compensation insurance for its employees as well as found that no exemptions from workers' compensation had been issued in connection with Nobel. Petitioner's investigator also performed a National Council on Compensation Insurance search on Nobel while at the business site. The search revealed that Nobel's employees had not had workers' compensation insurance in the past. On June 9, 2009, Petitioner's investigator issued a SWO and posted it at the business site. The SWO required Respondent to cease all business operations. On June 10, 2009, Respondent obtained a certificate of insurance for workers' compensation coverage with the effective date being the same. The policy was issued by One-Stop Insurance Agency. Respondent provided the certificate to Tolentino upon receipt. On June 12, 2009, Petitioner's investigator issued to Respondent a Division of Workers' Compensation Request for Production of Business Records for Penalty Assessment Calculation ("Request"). Soon thereafter, Respondent responded to the Request and provided Petitioner's investigator with the requested records. Petitioner's investigator forwarded the documents to Jorge Pinera, Petitioner's penalty calculator, for review. On or about July 17, 2009, Petitioner issued an Amended Order of Penalty Assessment assessing a penalty of $74,794.38 against Respondent. On August 10, 2009, Respondent entered into a payment agreement with the Division. Respondent provided the Division a $7,480.00 cashier's check and agreed to pay the remainder of the assessed penalty in monthly installments. As a result, Petitioner issued an Order of Conditional Release for Nobel to operate. On March 3, 2010, Respondent supplied an employee list with position descriptions to Petitioner. After reviewing the document, Petitioner changed some employee class codes to indicate a lower rate for some occupations and recalculated the penalty amount owed with the new class codes. For the recalculation, Petitioner's penalty calculator, Russell Gray, used the following calculation from the penalty worksheet: (a) Respondent's total gross payroll from June 10, 2006, through June 9, 2009, was $1,010,001.32; (b) the total workers' compensation premium that Respondent should have paid for its employees during the relevant time period was $45,483.96; and (c) the premium was multiplied by the statutory factor of 1.5 resulting in a penalty assessment in the amount of $68,224.81. The new calculation superseded the Amended Order and a Second Amended Order of Penalty Assessment was issued March 3, 2010, reducing Respondent's penalty to $68,224.81.1 During the hearing, Respondent admitted not having workers' compensation coverage for his employees. He said, "Yes, you're right I needed to have workers' compensation but as I said . . . I never knew that I needed to have workers' compensation . . . I'm here to ask for forgiveness."
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, issue a final order affirming the Stop Work Order and Second Amended Order of Penalty Assessment in the amount of $68,224.81. DONE AND ENTERED this 20th day of April, 2010, in Tallahassee, Leon County, Florida. S JUNE C. McKINNEY 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 20th day of April, 2010.
The Issue The issue in this case is whether Respondent violated the provisions of chapter 440, Florida Statutes,1/ by failing to secure the payment of workers’ compensation, as alleged in the Stop-Work Order and Third Amended Order of Penalty Assessment, and if so, what is the appropriate penalty.
Findings Of Fact The Department is the state agency responsible for enforcing the statutory requirement that employers secure workers’ compensation coverage for the benefit of their employees. Respondent is a Florida, for-profit corporation with its principal office located at 3539 Apalachee Parkway, Suite 3-204, Tallahassee, Florida 32311. Respondent was incorporated on October 26, 2012, and has been engaged in the construction industry in Florida as a roofing company since October 31, 2012. From Respondent’s inception, Richard Paul Morejon has been Respondent’s president, secretary, and treasurer, and has received compensation from Respondent’s roofing contract proceeds. In July or August 2013, the Department received a complaint alleging that Respondent was not in compliance with Florida's Workers' Compensation Law. The Department assigned investigation of the complaint to then-Department investigator Carey Horn. Based upon materials apparently gathered and reports purportedly authored by Investigator Horn, the Department issued a stop-work order dated September 23, 2013, to Respondent alleging that Respondent did not secure workers’ compensation coverage for its employees as required. The Department, however, did not call Investigator Horn as a witness, and, despite Mr. Morejon’s attempt to subpoena her to testify in this case, Investigator Horn could not be found. The Department’s delay in referring this case for a final hearing either caused or contributed to Investigator Horn’s unavailability as a witness in this proceeding. The reports and conclusions of Investigator Horn were prepared in anticipation of litigation and are hearsay.2/ Therefore, they have not been used to support factual findings in this Recommended Order unless corroborative of non-hearsay evidence.3/ In addition, on October 20, 2014, the Department filed a document entitled "Joint Prehearing Stipulation" signed by the Department’s counsel and Mr. Morejon purporting to contain a number of stipulated facts and factual admissions by Mr. Morejon on behalf of Respondent. However, at the final hearing, the manner in which the Joint Prehearing Stipulation was procured was brought into question when Mr. Morejon advised that he was told to sign it and that the stipulation would be “ironed out” at the final hearing. The Department’s counsel confirmed that the conversation occurred regarding the correct classification code to be utilized in calculating the penalty against Respondent. Accordingly, it was ruled at the final hearing that the Joint Stipulation would not be used to support a finding regarding the classification. Upon further consideration of Mr. Morejon’s comments and the Department’s counsel’s admission as to the manner in which at least one of the stipulated facts was secured, the undersigned has not utilized and otherwise rejects as untrustworthy the document entitled "Joint Prehearing Stipulation" filed in this case on October 20, 2014, finding that it does not represent any bona fide stipulations or admissions. Nevertheless, in his testimony during his deposition and at the final hearing in this case, Mr. Morejon admitted a number of factual matters demonstrating that Respondent was not in compliance with Florida’s Workers’ Compensation Law on September 23, 2013. The factual findings in this Recommended Order are derived from Mr. Morejon’s testimony, non-hearsay evidence, and corroborative hearsay submitted during the final hearing. On September 23, 2013, Investigator Horn visited a jobsite at a residence located at 5747 Sioux Drive, Tallahassee, Florida (Jobsite), where Respondent, through employees, was performing roofing and related activities. On that date, Mr. Morejon was on the ground supervising two men on the roof engaged in roofing activities and two men on the ground picking up debris, for a total of five men, including Mr. Morejon, at the Jobsite working for Respondent. There was another man sitting in a vehicle at the Jobsite that day who never did any work for Respondent. There is no evidence that Respondent provided workers’ compensation coverage for any of the men working at the Jobsite that day. The two men working on the roof were Guadalupe Perez- Martinez and Hermilo Perez-Martinez. At the time, Guadalupe Perez-Martinez had an exemption from the requirements for workers’ compensation through his company, Lupe Builders, LLC. Although Hermilo Perez-Martinez previously had an exemption from the requirements of workers’ compensation through Perez Builders, LLC, that exemption expired the previous month, on August 3, 2013. There is no evidence that the two men picking up debris, Hermilo Pantaleon Paz and Timotio Aguilar, qualified for an exemption from workers’ compensation coverage that day. Although Mr. Morejon had an exemption from the requirements of Florida's Workers' Compensation Law for a separate and unaffiliated company, Comerxio, Mr. Morejon did not have an exemption from the coverage requirements of Florida's Workers' Compensation Law for Respondent on September 23, 2013, or during the relative time periods of this case. According to Mr. Morejon, other than Guadalupe Perez- Martinez, none of the other workers at the Jobsite that day had ever performed work for Respondent. Mr. Morejon also recalled that another person on the Jobsite that day, David Amaro- Rodriguez, just sat in a car and performed no work. Mr. Morejon’s recollections are unrefuted. The Department’s delay in referring this case undoubtedly affected the ability of either party to call other witnesses, including a number of the workers or the investigator, who were at the Jobsite that day. During the relevant time periods, Respondent did not maintain a bank account to pay its employees and it did not directly pay Mr. Morejon or other employees. Rather, historically, proceeds from roofing contracts performed by Respondent were deposited into a bank account held by another corporation named "A 2 Z Roofing, Inc." After paying various expenses, including permit fees, materials, and other costs associated with the roofing contracts, A 2 Z Roofing, Inc., paid Mr. Morejon, and any others performing work under the contracts, by check. On September 23, 2013, the Department personally served the Respondent with a stop work order (Stop Work Order) and a request for production of business records for penalty assessment calculation (Records Request). The Records Request requested Respondent’s corporate records, licenses, payroll documents, account documents, disbursements, contracts for work, employee leasing information, subcontractors, and workers' compensation coverage or exemptions "for the period from 10/31/2012 through 09/23/2013 [the Non- Compliance Period]." The Records Request further stated, in part: The employer should scan and email the records requested herein to the investigator with the Department of Financial Services, Division of Workers’ Compensation for examination within 5 business days after receipt of this Request for Production of Business Records. If the employer fails to provide the required business records sufficient to enable the Department of Financial Services, Division of Workers’ Compensation to determine the employer’s payroll for the period requested for the calculation of the penalty provided in section 440.107(7)(d), F.S., the imputed weekly payroll for each employee, corporate officer, sole proprietor, or partner shall be the statewide average weekly wage as defined in section 440.12(2), F.S. multiplied by 1.5. The Department shall impute the employer’s payroll at any time after ten, but before the expiration of twenty business days after receipt by the employer of a written request to produce such business records. (FAC 69L-6.028) If the employer is unable to scan and email these documents, please mail or deliver copies to our office located at 200 East Gaines Street Tallahassee, FL, 32399-4228. The next day, September 24, 2013, Mr. Morejon hand delivered Respondent’s business records to the Department in response to the Records Request. The business records delivered by Mr. Morejon included roofing permit applications; roofing permits issued to A to Z Roofing, Inc.; several contracts between homeowners and A to Z Roofing, Inc., identifying Mr. Morejon as project manager; five checks from A 2 Z Roofing, Inc. (not Respondent), payable to the City of Tallahassee; and 24 checks from A 2 Z Roofing, Inc., payable to "Mr. Morejon – Petty Cash." The 24 checks from A 2 Z Roofing, Inc., to Mr. Morejon totaled $55,955.4/ The checks, dated from November 17, 2012, to August 23, 2013, constitute all of the money paid to Mr. Morejon from Respondent’s roofing contract proceeds during the Non- Compliance Period. In addition to the 24 checks payable to Mr. Morejon, it is evident that the Department also received other checks from A 2 Z Roofing, Inc., from the records requests made in this case and in DOAH Case No. 14-2829, made payable to Lupe Builders, LLC, Gene Pfund, and perhaps others, during the Non- Compliance Period. The Department, however, did not utilize those records in its determinations in this case. In fact, the Department’s penalty auditor did not utilize payments made by A 2 Z Roofing, Inc., in calculating the penalty because, in the Department’s penalty auditor’s opinion, Respondent was not compliant because it did not have a bank account. Final Hearing Transcript, pp. 232-233. The determination of payroll, however, is not dependent on whether an employer has a bank account or whether the employer is the entity that pays its employees. Rather, the Department’s own rule defining payroll considers "[p]ayments, including cash payments, made to employees by or on behalf of the employer" in determining payroll. See Fla. Admin. Code Rule 69L-6.035(1)(b)(emphasis added). During the hearing, the Department, through counsel, stated that the payments from A 2 Z Roofing to Lupe Builders, LLC, or Gene Pfund were not considered because those entities had valid exemptions from the requirements of workers’ compensation. In addition, the Department complained that their receipt of bank records from A 2 Z Roofing, Inc., had been delayed and took the position that bank records from A 2 Z Roofing, Inc., would not be utilized in this case. The Department’s own discovery tactics, however, were responsible for delays in responses to its requests for records from A 2 Z Roofing, Inc.5/ Considering the records produced by Respondent introduced into evidence in this case, the testimony of Mr. Morejon regarding the checks payable to him from A 2 Z Roofing, Inc., the Department’s unwillingness to utilize other records from A 2 Z Roofing, Inc., in its possession, and evidence of the total payments to Mr. Morejon during the Non- Compliance Period, it is found that the Department’s decision to impute payroll is unfounded. Imputation of payroll would improperly allow the Department to benefit from its own lack of analysis. The imputed payroll determined by the Department in the amount of $347,334.69 exceeds Respondent’s total revenue for the Non- Compliance Period by more than $100,0006/ and is based, at least in part, upon hearsay evidence prepared by a witness whose unavailability was likely caused by the Department’s undue delay in referring Respondent’s Request for Hearing. Furthermore, the records produced by Respondent and the evidence in this case are sufficient to determine Respondent's payroll for use in the calculation of a penalty pursuant to section 440.107(7)(d)l. The evidence demonstrated that the $55,955 reflected in checks payable to Mr. Morejon from A 2 Z Roofing, Inc., represent all of the payments to Respondent’s employees who were not covered by workers’ compensation while performing services for roofing contracts during the Non-Compliance Period, other than payments reflected in records the Department may have in its possession but did not present at the final hearing. It was also shown, however, that the $55,955 was paid to Mr. Morejon without the maintenance of a cash log or cash journal and without securing the payment of workers' compensation coverage for Mr. Morejon or others receiving cash payments from those funds. And, there is no evidence that any of those employees were exempt from the requirements of workers’ compensation. Respondent was required to secure workers' compensation coverage and failed to secure that coverage under Florida’s Workers’ Compensation Law for its employees who were paid $55,955.00 during the Non-Compliance Period. Therefore, the Department was justified in issuing the Stop Work Order delivered to Mr. Morejon on September 23, 2013. Although the Department failed to show that Respondent’s payroll should be imputed, the evidence adduced at the final hearing demonstrated that a penalty should be imposed against Respondent for failure to pay workers’ compensation for its employees who were paid a total of $55,955 during the Non- Compliance Period. For determining the appropriate penalty, the Department has adopted a penalty calculation worksheet to aid in calculating penalties against employers pursuant to section 440.107, Florida Statutes. See Florida Administrative Code Rule 69L-6.027. The classification codes listed in the National Council on Compensation Insurance ("NCCI") Scopes® Manual have been adopted by the Department through Florida Administrative Code Rules 69L-6.021 and 69L-6.031. Classification codes are four-digit codes assigned to occupations by NCCI to assist in the calculation of workers' compensation insurance premiums. Under the descriptions listed in the NCCI Scopes® Manual, the proper classification code for Respondent’s employees is 5551, which corresponds to "Roofing - All Kinds and Drivers." The Department has adopted the approved manual rates in the Florida Administrative Code, as authorized by section 440.107(7). Rule 69L-6.027 adopts form number DFS-F4-1595, the Penalty Calculation Worksheet, which specifically incorporates approved manual rates. As accurately set forth in the Penalty Calculation Worksheets attached to the Amended Order of Penalty Assessment, the approved manual rates for the following periods of Non- Compliance were: From 10/31/2012 to 12/31/2012 the rate was 17.10; From 01/01/2013 to 06/30/2013 the rate was 18.17; From 07/01/2013 to 09/23/2013 the rate was 18.03. A breakdown of Respondent’s total payroll of $55,955 based upon check dates corresponding to the manual rates in effect during the Non-Compliance Period, is as follows: From 10/31/2012 to 12/31/2012 payroll totaled $6,300; From 01/01/2013 to 06/30/2013 payroll totaled $33,655; From 07/01/2013 to 09/23/2013 payroll totaled $16,000. Calculation of the penalty, using the Penalty Calculation Worksheet and Respondent’s payroll based on records (as opposed to imputed) during the Non-Compliance Period, results in a total penalty of $15,116.12, as follows: Calculation Method (a) Class Code (b) Non-Compliance period (c) Gross Payroll (d) /100 (e) Approved Rates (f) Premium (d)X(e) (g) Penalty (f)X 1.5 Records 5551 10/31/12 12/31/12 6,300 63 17.10 1,077.30 1,616.25 Records 5551 01/01/13 06/30/13 33,655 336.55 18.17 6,115.11 9,172.67 Records 5551 07/01/13 09/23/13 16,000 160 18.03 2,884.80 4,327.20 Totals: $55,955.00 $15,116.12 The clear and convincing evidence in this proceeding demonstrated that Respondent was in violation of Florida’s Workers’ Compensation law because it employed one or more uninsured employees in the construction industry throughout the Non-Compliance Penalty, and that the appropriate penalty, based upon Respondent’s payroll, is in the amount of $15,116.12.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department enter a Final Order consistent with this Recommended Order upholding the Stop Work Order, and reducing the penalty set forth in the Amended Order of Penalty Assessment to $15,116.12 by recalculating the penalty based upon Respondent’s payroll of $55,955.00 during the Non-Compliance Period. DONE AND ENTERED this 5th day of February, 2015, in Tallahassee, Leon County, Florida. S JAMES H. PETERSON, III Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 5th day of February, 2015.
The Issue Whether Petitioner, Department of Financial Services, Division of Workers’ Compensation (the Department), properly issued a Stop-Work Order and Penalty Assessment against Respondent, Ogles Construction and Roofing, LLC (Respondent), for failing to obtain workers' compensation insurance that meets the requirements of chapter 440, Florida Statutes.1/
Findings Of Fact Based upon the testimony and documentary evidence presented at hearing, the demeanor and credibility of the witnesses, and on the entire record of this proceeding, the following findings of fact are made: On September 30, 2013, the parties filed a Joint Pre- hearing Stipulation, by which the parties stipulated to the facts set forth in the following paragraphs 2 through 12. Those facts are accepted and adopted by the undersigned. The Department is the state agency responsible for enforcing the statutory requirement that employers secure the payment of workers’ compensation for the benefit of their employees and corporate officers. Respondent, a Florida corporation,2/ was engaged in business operations as a roofing company in the State of Florida from June 13, 2010, through June 12, 2013. Respondent received a Stop-Work Order for Specific Worksite Only and Order of Penalty Assessment from the Department on June 12, 2013. Respondent received a Request for Production of Business Records for Penalty Assessment Calculation from the Department on June 12, 2013. The penalty period in this case is from June 13, 2010, through June 12, 2013. Respondent employed Robert Ogles, II, Matthew Ogles, and Stephen Ogles during the period from June 13, 2010, through June 12, 2013. Robert Ogles had no exemption from June 13, 2010, through November 14, 2010, and from November 15, 2012, through January 9, 2013. Respondent was an “employer,” as defined in chapter 440, Florida Statutes, throughout the penalty period. Respondent did not secure workers' compensation insurance coverage for its employees during the period from June 13, 2010, through June 12, 2013. The appropriate class code from the National Council on Compensation Insurance, Inc. (NCCI), Scopes Manual for Respondent's employees is 5551, corresponding to “Roofing - All Kinds and Drivers.” The NCCI manual rates attached to the Prehearing Stipulation as Exhibit “C” are the correct manual rates for NCCI Class Code 5551 during the penalty period. Given the above stipulations, Respondent was in violation of the workers’ compensation coverage requirements of chapter 440 because Respondent employed uninsured employees working as roofers throughout the penalty period. Andre Canellas, penalty auditor for the Department, was assigned to assess the appropriate penalty owed by Respondent. Penalties for workers' compensation insurance violations are based on the amount of evaded insurance premiums over the three-year period preceding the Stop-Work Order, multiplied by 1.5. § 440.107(7)(d)1., Fla. Stat. At the time of his assignment, Mr. Canellas was provided with personal bank statements from Matthew, Stephen, and Robert Ogles, II, some checks that were written to Stephen and Robert Ogles, II, and an excel spreadsheet typed up for Respondent's payroll to Matthew Ogles. The records from Robert Ogles, II, consisted of statements from his personal bank account, which he jointly held with his wife, covering the course of the penalty period; and checks paid from Respondent to Robert Ogles, II, during the years of 2012 and 2013. The bank statements reference the amounts of all transactions in Robert Ogles, II, and his wife's joint personal bank account and do not distinguish the amounts for payroll from Respondent. From the periods of time in which Robert Ogles, II, produced checks from Respondent, Mr. Canellas was able to determine that Robert Ogles, II, did not deposit the entire amount from Respondent into his joint personal bank account. Thus, Robert Ogles, II's, personal joint bank statements covering the course of the penalty period were insufficient to enable the Department to determine his compensation from Respondent for those time periods. With respect to Stephen Ogles, the Department received statements from a joint personal bank account for the period of December 2012 through June 2013; checks paid from Respondent from December 2012 through June 7, 2013; and an IRS Form 1099 for payroll to Stephen Ogles, LLC from Respondent. The Department received personal bank statements from Matthew Ogles for the entire penalty period and an excel spreadsheet setting forth the payroll to Matthew Ogles from Respondent for all but one month of the penalty period. Petitioner did not receive any records at all for the payroll to Robert Ogles or to any of Respondent's subcontractors. Although Robert Ogles testified in deposition that he probably has the records requested by the Department, he stated that he “just chose not to” produce them. Employers in Florida are required to maintain the records that were requested by the Department and produce them upon the Department's request. See Fla. Admin. Code R. 69L- 6.015(1) and 6.032(1). For the time periods of January 1, 2012, through November 14, 2012, and from January 10, 2013, through June 12, 2013, Mr. Canellas could have potentially ascertained Respondent's payroll to Matthew, Stephen, and Robert Ogles, II- assuming that those individuals had identified all of the payroll they had received from Respondent during those periods. However, Mr. Canellas could not determine Respondent's overall payroll because the Department did not receive any records concerning Respondent's payroll to the subcontractors that Respondent regularly hires. Having not received business records sufficient to determine Respondent's actual payroll for the period of June 13, 2010, through June 12, 2013, Penalty Auditor Canellas calculated an Amended Order of Penalty Assessment of $158,423.82 by imputing the statewide average weekly wage, multiplied by 1.5, to Respondent's payroll for each identified employee during the penalty period. This methodology is required by section 440.107(7)(e), and Florida Administrative Code Rule 69L- 6.028(3). The Statewide Average Weekly Wage is determined by the Agency for Workforce Innovation (now the Department of Economic Opportunity). When the Average Weekly Wage changes, the Department updates its Coverage and Compliance Automated System (CCAS) to reflect the new amounts. The Average Weekly Wage that corresponds to various periods of non- compliance are populated automatically in the penalty worksheet when a penalty auditor selects an imputed penalty in CCAS. The Department has adopted a penalty calculation worksheet to aid in calculating penalties against employers pursuant to section 440.107. See Fla. Admin Code R. 69L-6.027. Mr. Canellas utilized this worksheet in assessing Respondent's penalty. In the penalty assessment calculation, the Department's Penalty Auditor consulted the classification codes listed in the Scopes Manual, which has been adopted by the Department through Florida Administrative Code Rule 69L- 6.021(3). As stipulated by the parties, the appropriate class code from the NCCI Scopes Manual for Respondent's employees is 5551, corresponding to “Roofing - All Kinds and Drivers.” Penalty Auditor Canellas applied the correct manual rates corresponding to class code 5551 for the periods of non- compliance in calculating the penalty. Mr. Canellas utilized the manual rates to satisfy his statutory obligation to determine the evaded workers' compensation insurance premium amounts for the period of June 13, 2010, through June 12, 2013, pursuant to section 440.107(7)(d)l. Respondent did not provide records sufficient to enable the Department to determine his actual total payroll for the period at issue. Accordingly, the Department was required to impute Respondent’s payroll in calculating the penalty assessment set forth in the Amended Order of Penalty Assessment. The Amended Order of Penalty Assessment is calculated correctly, if the manual rates were properly adopted by rule.
Recommendation Based on the Findings of Fact and Conclusions of Law set forth herein, it is RECOMMENDED that the Department of Financial Services, Division of Workers’ Compensation enter a final order assessing a penalty of $158,423.82 against Respondent, Ogles Construction and Roofing, LLC, for its failure to secure and maintain required workers’ compensation insurance for its employees. DONE AND ENTERED this 23rd day of May, 2014, in Tallahassee, Leon County, Florida. S W. David Watkins 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 23rd day of May, 2014.
The Issue Whether Royal Roofing and Restoration, Inc. (Respondent or Royal Roofing), failed to secure workers’ compensation insurance coverage for its employees; and, if so, whether the Department of Financial Services, Division of Workers’ Compensation (Petitioner or Department), correctly calculated the penalty to be assessed against Respondent.
Findings Of Fact Petitioner is the state agency charged with enforcing the requirement of chapter 440, that Florida employers secure workers’ compensation coverage for their employees. § 440.107(3), Fla. Stat. Respondent is a Florida for-profit corporation organized on July 28, 2015, and engaged in the business of roofing and storm damage restoration. The company was formed, and initially conducted business, in Tallahassee, Florida, but expanded to the Panama City area in 2016. Traci Fisher is Respondent’s President and Registered Agent, with a mailing address of 1004 Kenilworth, Tallahassee, Florida 32312. DOAH Case No. 17-0879 On May 4, 2016, Department Compliance Investigator Jesse Holman, conducted a routine workers’ compensation compliance inspection at 374 Brown Place in Crestview, Florida. Mr. Holman observed four men removing shingles from the roof of a residential structure at that address. Mr. Holman first interviewed a worker who identified himself as Dustin Hansel and reported that he and the other three workers on site were a new crew for Respondent, the permit for the job had not yet been pulled, and the workers were not aware of the rate of pay for the job. Mr. Hansel telephoned Respondent’s sales manager, Dillon Robinson, who then spoke directly with Mr. Holman via telephone. Mr. Robinson informed Mr. Holman that Respondent obtained workers’ compensation coverage through Payroll Management Inc. (PMI), an employee-leasing company. Mr. Holman identified the three remaining workers at the jobsite as Milton Trice, Winston Perrotta, and Kerrigan Ireland. Mr. Holman contacted PMI and secured a copy of Respondent’s then-active employee roster. None of the workers at the jobsite, including Mr. Hansel, were included on Respondent’s employee roster. Upon inquiry, Mr. Holman was informed that PMI had no pending employee applications for Respondent. Mr. Holman consulted the Department’s Coverage Compliance Automated System (CCAS) and found Respondent had no workers’ compensation insurance policy and no active exemptions. During Mr. Holman’s onsite investigation, the workers left the jobsite. Mr. Holman could not immediately reach Ms. Fisher, but did speak with her husband, Tim Fisher. Mr. Fisher informed Mr. Holman that the crew was on their way to the PMI Fort Walton office to be enrolled on Respondent’s employee roster. On May 5, 2016, based on his investigation, and after consultation with his supervisor, Mr. Holman issued Respondent Stop-Work Order (SWO) 16-148-1A, along with a Business Records Request (BRR) for records covering the audit period of July 27, 2015 through May 4, 2016. Later that day, Mr. Holman spoke to Ms. Fisher, who informed him the crew did not have permission to begin the work on that date, as she had not yet pulled the permit for the reroof. Ms. Fisher further explained that the crewmembers had been instructed to complete applications with PMI prior to departing Tallahassee for Crestview. Ms. Fisher confirmed the crewmembers were completing applications at PMI Fort Walton that same day. Mr. Holman met with Ms. Fisher the following day and personally served SWO 16-148-1A. Ms. Fisher delivered to Mr. Holman an updated employee roster from PMI which included Mr. Hansel, Mr. Perrotta, and Mr. Ireland; a letter documenting Mr. Trice was not employed by Respondent; and a $1000 check as downpayment on the penalty. Respondent initially submitted business records in response to the BRR on May 23 and 25, 2017. DOAH Case No. 17-1558 On June 8, 2016, Mr. Holman conducted a random workers’ compensation compliance inspection at 532 Rising Star Drive in Crestview. The single-family home at that address was undergoing renovations and Mr. Holman observed three men on the roof removing shingles. None of the men on the roof spoke English, but a fourth man, who identified himself as Jose Manuel Mejia, appeared and stated he worked for Respondent, and that all the workers onsite were paid through PMI at a rate of $10.00 per hour. Mr. Mejia admitted that one of the worker’s onsite, Emelio Lopez, was not enrolled with PMI and explained that Mr. Mejia brought him to the worksite that day because he knew Mr. Lopez to be a good worker. The remaining workers onsite were identified as Juan Mencho and Ramon Gonzalez, both from Atlanta, Georgia. Mr. Mejia produced some PMI paystubs for himself and Mr. Mencho. Mr. Mejia stated that he and his crews also received reimbursement checks directly from Respondent for gas, rentals, materials, and the like. Mr. Holman contacted PMI, who produced Respondent’s then-active employee roster. Mr. Mejia and Mr. Mencho were on the roster, but neither Mr. Gonzalez nor Mr. Lopez was included. Mr. Holman next contacted Ms. Fisher, who identified Mr. Mejia as a subcontractor, but was not familiar with any of the other men Mr. Holman encountered at the worksite. Mr. Holman consulted via telephone with his supervisor, who instructed him to issue an SWO to Respondent for failing to secure workers’ compensation coverage for its employees. Mr. Holman issued SWO 16-198-1A by posting the worksite on June 8, 2016. Department Facilitator Don Hurst, personally served Ms. Fisher with SWO 16-198-1A in Tallahassee that same day. SWO 16-148-1A Penalty Calculation1/ Department Penalty Auditor Eunika Jackson, was assigned to calculate the penalties associated with the SWOs issued to Respondent. On June 8, 2016, Ms. Jackson began calculating the penalty associated with SWO 16-148-1A. Ms. Jackson reviewed the documents submitted by Respondent in response to the BRR. The documents included Respondent’s Wells Fargo bank statements, check images, and PMI payroll register for the audit period.2/ Based on a review of the records, Ms. Jackson identified the following individuals as Respondent’s employees because they received direct payment from Respondent at times during the audit period: David Rosinsky, Dylan Robinson, Jarod Bell, Tommy Miller, and David Shields. Ms. Jackson determined periods of non-compliance for these employees based on the dates they received payments from Respondent and were not covered for workers’ compensation via PMI employment roster, separate policy, or corporate officer exemption. Ms. Jackson deemed payments to each of the individuals as gross payroll for purposes of calculating the penalty. Based upon Ms. Fisher’s deposition testimony, Ms. Jackson assigned National Council on Compensation Insurance (NCCI) class code 5551, Roofing, to Mr. Miller; NCCI class code 5474, Painting, to Mr. Rosinsky; NCCI class code 8742, Sales, to Mr. Bell and Mr. Robinson; and NCCI class code 8810, clerical office employee, to Mr. Shields. Utilizing the statutory formula for penalty calculation, Ms. Jackson calculated a total penalty of $191.28 associated with these five “employees.” Ms. Jackson next calculated the penalty for Dustin Hansel, Kerrigan Ireland, Milton Trice, and Winston Perrotta, the workers identified at the jobsite as employees on May 4, 2016. The Department maintains that the business records submitted by Respondent were insufficient to determine Respondent’s payroll to these “employees,” thus, Ms. Jackson used the statutory formula to impute payroll to these workers. Ms. Jackson calculated a penalty of $14,970.12 against Respondent for failure to secure payment of workers’ compensation insurance for each of these four “employees” during the audit period. The total penalty associated with these four “employees” is $59,880.48. Ms. Jackson calculated a total penalty of $60,072.96 to be imposed against Respondent in connection with SWO 16-148- 1A. Business Records In compliance with the Department’s BRR, Respondent submitted additional business records on several occasions-- March 21, May 3 and 31, June 7, and August 15 and 24, 2017--in order to establish its complete payroll for the audit period. While the Department admits that the final documents submitted do establish Respondent’s complete payroll, the Department did not issue amended penalty assessment based on those records in either case. The Department maintains Respondent did not timely submit records, pursuant to Florida Administrative Code Rule 69L-6.028(4), which allows an employer 20 business days after service of the first amended order of penalty assessment to submit sufficient records to establish payroll. All business records submitted by Respondent were admitted in evidence and included as part of the record. The undersigned is not limited to the record before the Department at the time the amended penalty assessments were imposed, but must determine a recommendation in a de novo proceeding. The undersigned has relied upon the complete record in arriving at the decision in this case. Penalty Calculation for Ireland, Trice, and Perrotta For purposes of workers’ compensation insurance coverage, an “employee” is “any person who receives remuneration from an employer” for work or services performed under a contract. § 440.02(15)(a), Fla. Stat. Respondent did not issue a single check to Mr. Ireland, Mr. Trice, or Mr. Perrotta during the audit period. Mr. Ireland, Mr. Trice, and Mr. Perrotta are not included on any PMI leasing roster included in the record for the audit period. The uncontroverted evidence, including the credible and unrefuted testimony of each person with knowledge, established that Mr. Ireland, Mr. Trice, and Mr. Perrotta were newly hired for the job in Crestview on May 4, 2016, and began working that day prior to submitting applications at PMI, despite Ms. Fisher’s directions otherwise. Petitioner did not prove that either Mr. Ireland, Mr. Trice, or Mr. Perrotta was Respondent’s employee at any time during the audit period. Petitioner did not correctly calculate the penalty of $44,911.26 against Respondent for failure to secure workers’ compensation insurance for Mr. Ireland, Mr. Trice, and Mr. Perrotta during the audit period. Penalty Calculation for Hansel Ms. Fisher testified that Mr. Hansel has owned several businesses with which Respondent has conducted business over the years. Originally, Mr. Hansel owned a dumpster rental business, now owned by his father. Mr. Hansel also owned an independent landscaping company with which Respondent occasionally transacted business. When Respondent expanded business into the Panama City area, Ms. Fisher hired Mr. Hansel as a crew chief to supervise new crews in the area. The job on May 4, 2016, was his first roofing job. A review of Respondent’s records reveals Respondent issued the following checks to Mr. Hansel during the audit period: December 4, 2015, in the amount of $360, $300 of which was for “dumpster rental” and the remaining $60 for “sod”; May 4, 2016, in the amount of $200 for “sod repair”; May 6, 2016, in the amount of $925 as reimbursement for travel expenses; May 9, 2016, in the amount of $1,011.50 (with no memo); and May 21, 2016, in the amount of $100 for “7845 Preservation.” Mr. Hansel was included on Respondent’s PMI leasing roster beginning on May 13, 2016. Petitioner proved that Mr. Hansel was Respondent’s employee at times during the audit period. Petitioner did not prove that Respondent’s records were insufficient to determine payroll to Mr. Hansel during the audit period, which would have required an imputed penalty. Petitioner did not correctly calculate the penalty of $14,970.42 against Respondent for failure to secure workers’ compensation insurance coverage for Mr. Hansel during the audit period. Sod repair by Mr. Hansel is a service performed for Respondent during the audit period. Reimbursement of travel expenses is specifically included in the definition of payroll for purposes of calculating the penalty. See Fla. Admin. Code R. 69L- 6.035(1)(f) (“Expense reimbursements, including reimbursements for travel” are included as remuneration to employees “to the extent that the employer’s business records and receipts do not confirm that the expense incurred as a valid business expense.”). Dumpster rental is neither work performed on behalf of, nor service provided to, Respondent during the audit period. The correct uninsured payroll amount attributable to Mr. Hansel is $2,296.50. Petitioner correctly applied NCCI class code 5551, Roofing, to work performed by Mr. Hansel based on the observation of Mr. Holman at the worksite on May 4, 2016. With respect to Mr. Hansel’s services for sod and sod repair, Petitioner did not correctly apply NCCI class code 5551. Petitioner did not introduce competent substantial evidence of the applicable NCCI class code and premium amount for landscaping services performed during the audit period.3/ Uninsured payroll attributable to Mr. Hansel for roofing services during the audit period is $2,036.50. The approved manual rate for workers’ compensation insurance for NCCI class code 5551 during the period of non- compliance--May 9 and 21, 2016--is $18.60. The premium amount Respondent would have paid to provide workers’ compensation insurance for Mr. Hansel is $378.79 (One percent of Mr. Hansel’s gross payroll during the non-compliance period--$20.36--multiplied by $18.60). The penalty for Respondent’s failure to secure worker’s compensation coverage insurance for Mr. Hansel during the period of non-compliance is calculated as two times the amount Respondent would have paid in premium for the non- compliance period. The correct penalty for Respondent’s failure to maintain workers’ compensation coverage for Mr. Hansel during the period of non-compliance is $757.58. Penalty Calculation for Salesmen Independent contractors not engaged in the construction industry are not employees for purposes of enforcing workers’ compensation insurance requirements. See § 440.02(15)(d)1., Fla. Stat. Sales is a non-construction industry occupation. The Department calculated a penalty associated with payroll attributable to the following persons identified by Ms. Fisher as independent salesmen: Dylan Robinson, Kevin Miller, Marc Medley, Mike Rucker, Colby Fisher, David Jones, Jarod Bell, Matt Flynn, and Todd Zulauf. Section 440.02(15)(d)1. provides that an individual may be an independent contractor, rather than an employee, as follows: In order to meet the definition of independent contractor, at least four of the following criteria must be met: 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 regulations; The independent contractor receives compensation for services rendered or work performed and such compensation is paid to a business rather than to an individual; The independent contractor holds one or more bank accounts in the name of the business entity for purposes of paying business expenses or other expenses related to services rendered or work performed for compensation; The independent contractor performs work or is able to perform work for any entity in addition to or besides the employer at his or her own election without the necessity of completing an employment application or process; or The independent contractor receives compensation for work or services rendered on a competitive-bid basis or completion of a task or a set of tasks as defined by a contractual agreement, unless such contractual agreement expressly states that an employment relationship exists. If four of the criteria listed in sub- subparagraph a. do not exist, an individual may still be presumed to be an independent contractor and not an employee based on full consideration of the nature of the individual situation with regard to satisfying any of the following conditions: The independent contractor performs or agrees to perform specific services or work for a specific amount 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 the work or services that he or she performs or agrees to perform. The independent contractor receives compensation for work or services performed for a commission or on a per-job 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. The success or failure of the independent contractor’s business depends on the relationship of business receipts to expenditures. Ms. Fisher testified that each of the above-named salesmen sold roofing jobs for her at various times during the audit period on a commission-only basis. The contractors inspect homeowner roofs, draft schematics, use their own equipment (e.g., drones), incur all of their own expenses, and handle the insurance filing for the homeowner’s insurance to pay on the claim. Ms. Fisher further testified that each of the salesmen also sells for other roofing contractors in the Tallahassee area. She pays the salesmen on a per-job basis. Ms. Fisher does not compensate the salesmen for the time involved in inspecting a roof, preparing schematics, or making the sale. Nor does Ms. Fisher reimburse the salesmen for travel to sales jobsites. Ms. Fisher’s testimony was credible, persuasive, and uncontroverted. Respondent introduced in evidence four “Independent Contractor Checklists” allegedly completed by Mr. Robinson, Mr. Medley, Mr. Fisher, and Mr. Flynn. Each form checklist follows the format of section 440.02(15)(d)1., listing the criteria set forth in subparagraphs a. and b. The forms indicate that they each meet all the criteria listed in subparagraph b.: they perform, or agree to perform services for a specific amount of money and control the means of performing the service; they incur the principal expenses related to the service performed; they are responsible for satisfactory completion of the services performed; they receive compensation for the services performed on a per-job or commission basis; they may realize a profit or suffer a loss in connection with performing the services; they have continuing and recurring business liabilities or obligations; and the success or failure of their business depends on the relationship of business receipts to expenditures.4/ In its Proposed Recommended Order, Petitioner conceded the nine men identified by Respondent as independent sales contractors “would not be considered employees of Respondent” because the “salesmen would seem to meet the majority of [the] requirements [of section 440.02(15)(d)1.b.].” Respondent issued Dylan Robinson, Mark Medley, Colby Fisher, Matt Flynn, Kevin Miller, Mike Rucker, Jarod Bell, David Jones, and Todd Zulauf an IRS FORM 1099-MISC for income paid during the 2016 tax year. Respondent did not prove by clear and convincing evidence that the above-named salesmen were Respondent’s employees during the audit period. For SWO 16-148-1A, Respondent did not correctly calculate the penalty because Respondent included a penalty associated with Petitioner’s failure to provide workers’ compensation insurance coverage for Dylan Robinson and Jarod Bell. Penalty in the amount of $20.70 associated with Dylan Robinson and Jarod Bell should not be included in the total penalty. The correct penalty amount for SWO 16-148-1A, based on records submitted by Respondent on or before March 20, 2016, is $929.16. Draft Revised Second Amended Order of Penalty Assessment The additional records submitted by Respondent revealed payments made to persons during the audit period who were not included in the Department’s Second Amended Order of Penalty Assessment. The Department and Respondent disagreed at hearing whether the payments qualified as payroll. At hearing, Petitioner submitted a draft revised second amended penalty calculation for SWO 16-148-1A based on all records received from Respondent. The revised penalty is in the amount of $61,453.50. Ms. Jackson populated the spreadsheet with the name of every individual to whom a check was written on Respondent’s business bank account during the audit period, removing only those payments to individuals and entities which, to Petitioner’s knowledge, were not Respondent’s employees. Respondent’s calculations in the revised penalty suffer from some of the same errors as in the second amended penalty calculation--they include individuals Petitioner did not prove were Respondent’s employees, as well as payments which were not uninsured payroll. For the reasons explained herein, Petitioner did not prove that salesmen David Jones, Dylan Robinson, Jarod Bell, Kevin Miller, Mark Medley, Matt Flynn, Mike Rucker, Tim Fischer, and Colby Fisher were Respondent’s employees during the audit period. Respondent did not accurately calculate the penalty associated with those persons. Respondent made payments to David Shields during the audit period, which the Department argues should be included as payroll. The Department included payments to Mr. Shields in its draft revised second amended order of penalty assessment and assigned NCCI class code “8810” for clerical work. Mr. Shields is a licensed professional roofing contractor who acts as “qualifier” for Respondent’s business. A qualifier is a licensed professional who certifies plans for permit applications submitted by another business. Respondent pays Mr. Shields a flat fee per permit application qualified by him. The record evidence does not support a finding that Mr. Shields provides clerical services to Respondent. Mr. Shields provides some sort of professional services to Respondent, and is likely an independent contractor providing his own materials and supplies, maintaining his own business accounts, and liable for his own business success. Assuming Mr. Shields were Respondent’s employee, the Department introduced no evidence of an appropriate NCCI class code for Mr. Shields’ services. The Department did not prove that payments to Mr. Shields should be included as Respondent’s uninsured payroll during the audit period. Respondent paid Susan Swain a total of $258 during the audit period for clerical work. Ms. Fisher maintained Ms. Swain’s work was casual at first, and the payments reflect a time when she worked on-again, off-again, handling the paperwork for restoration insurance claims. Later, Ms. Swain came to work for Respondent full-time and was added to the PMI leasing roster. Section 440.02(15)(d)5. provides that a person “whose employment is both casual and not in the course of the trade, business, profession or occupation of the employer” is not an employee. The statute defines “casual” employment as work that is anticipated to be completed in 10 working days or less and at a total labor cost of less than $500. See § 440.02(5), Fla. Stat. In its Proposed Recommended Order, the Department argues Ms. Swain’s wages should be included as payroll because the “testimony regarding Ms. Swain does not suggest that she was employed for less than 10 days[.]” However, it was the Department’s burden to prove that Ms. Swain was a statutory employee. The Department did not prove that Ms. Swain’s wages should be included within Respondent’s uninsured payroll. The largest portion of the penalty assessed by the Department, as well as in the draft revised second amended penalty assessment, against Respondent is in connection with various roofers who were employed by Respondent at times during the audit period. Each of the roofers was included on Respondent’s PMI leasing roster, but received checks directly from Respondent in addition to PMI payroll checks. The Department included all the direct payments to those roofers as payroll for purposes of calculating a penalty in this case. As Ms. Fisher explained, the company bids a reroof on a per job basis--usually a per square foot price. Ms. Fisher adds each roofing contractor’s name to the PMI leasing roster to ensure that each roofer is covered by workers’ compensation insurance for the duration of the job. When the job is completed (which is a matter of just a few days), the contractor reports to Ms. Fisher what amount of the contract price was spent on materials, supplies, or other non-labor costs. Ms. Fisher cuts a check to the contractor for that amount and authorizes PMI to issue payroll checks for the “labor cost” (the difference between the contract price and the non-labor costs). Ms. Fisher refers to this process as “back-charging” the contractors for their materials, maintenance, tools, and other non-labor costs. The Department is correct that the direct payments are payroll to the roofing contractors. See Fla. Admin. Code R. 69L-6.035(1)(b) and (h) (remuneration includes “payments, including cash payments, made to employees by or on behalf of the employer” and “payments or allowances made by or on behalf of the employer for tools or equipment used by employees in their work or operations for the employer.”). The Department would be correct to include these payments in the penalty calculation if they represented uninsured payroll. However, the evidence supports a finding that the direct payments to the roofing contractors were made for the same jobs on which Respondent secured workers’ compensation coverage through PMI. The roofing contractors were covered for workers’ compensation throughout the job, even though they may have received partial payment for the job outside of the PMI payroll checks.5/ The direct payments were not for separate reroofs on which the roofers were not otherwise insured. The Department did not correctly calculate penalties associated with the following roofing contractors: Donald Tontigh, Joseph Howard, Keith Mills, Aaron Kilpatrick, Gustavo Tobias, Jose Mejia, and Tommy Miller. Ms. Fisher also received cash payments from Respondent during the audit period. These payments were made in addition to her payroll through PMI. Ms. Fisher described these payments as “cash tickets,” which were paid outside of her PMI payroll to reimburse her for investments made in the company. For purposes of calculating the penalty in this case, these “cash tickets” are clearly payroll, as that term is to be calculated pursuant to rule 69L-6.035. Similar to the issue with the roofing contractors, the question is whether the payments represent uninsured payroll. Ms. Fisher did not hold a corporate officer exemption at any time relevant hereto. Ms. Fisher testified that she was covered through PMI payroll leasing. In contrast to the roofing contractors, Ms. Fisher’s direct payments do not directly coincide with any particular job or specific time frame during which Ms. Fisher was covered for workers’ compensation insurance through PMI. The evidence was insufficient to determine that the amounts were insured payroll. The Department properly calculated a penalty associated with payroll attributable to Ms. Fisher. Respondent made one payment of $75 to Donald Martin during the audit period. The Department calculated a penalty of $27.90 associated with this payment to Mr. Martin. Ms. Fisher explained that Mr. Martin was a down-on-his-luck guy who came by the office one day complaining that Mr. Hansel owed him some money. Ms. Fisher offered to put him on a roofing crew and wrote him the $75 check to help him out. Ms. Fisher’s testimony was both credible and unrefuted. Mr. Martin was never hired by Respondent, put on any roofing crew, or added to the PMI leasing roster. Mr. Martin was not Respondent’s employee because he did not receive remuneration for the “performance of any work or service while engaged in any employment under any appointment or contract for hire” with Respondent. § 440.02(15)(a), Fla. Stat. Cale Dierking works for Respondent full-time in a clerical position. During the audit period, Respondent paid Mr. Dierking directly by check for $1,306.14. This payment was made outside of Mr. Dierking’s PMI payroll checks. Ms. Fisher testified that she paid Mr. Dierking directly on one occasion when “PMI’s payroll got stuck in Memphis, I believe it was a snow-in situation where payroll checks didn’t come.” Rather than ask her employee to go without a timely paycheck, she advanced his payroll. Ms. Fisher’s testimony was both credible and unrefuted. The payment to Mr. Dierking is clearly payroll. However, Mr. Dierking was covered for workers’ compensation through PMI for the period during which the check was issued. Thus, there is no evidence that it was uninsured payroll. The Department did not correctly calculate a penalty associated with payments to Mr. Dierking. The correct penalty to be assessed against Respondent for failure to secure workers’ compensation coverage for its employees during the audit period in connection with SWO 16-148- 1A is $770.60. Penalty Calculation for SWO 16-198-1A Ms. Jackson calculated a total penalty against Respondent in connection with SWO 16-198-1A in the amount of $19,115.84, as reflected in the Second Amended Order of Penalty Assessment. The Department correctly imputed penalty against Respondent in the amount of $91.68 each for uninsured payroll to Mr. Gonzalez and Mr. Lopez. The evidence supported a finding that these workers were Respondent’s statutory employees on June 8, 2016, and were not enrolled on the PMI leasing roster. The Department did not correctly calculate the penalty associated with salesmen Dylan Robinson, Jarod Bell, Kevin Miller, Mark Medley, Matt Flynn, and Todd Zulauf. The Department did not correctly calculate the penalty associated with roofing contractors Abraham Martinez- Antonio, Edwin Kinsey, Dustin Hansel, Efrian Molina-Agustin, Jose Mejia, Joseph Howard, Keith Mills, Samuel Pedro, and Tommy Miller. The Department did not correctly calculate the penalty against Respondent associated with Mr. Shields, Respondent’s qualifier. Based on a review of Respondent’s complete “untimely” records, the Department discovered direct payments made to additional employees not included on the Second Amended Order of Penalty Assessment. Respondent made a direct payment to Ethan Burch in the amount of $602.50 during the audit period. Ethan Burch is one of Respondent’s full-time clerical employees. The evidence is insufficient to determine whether the payment of $602.50 was insured or uninsured payroll. As such, the Department did not prove it correctly calculated the penalty associated with Mr. Burch. Respondent also made a direct payment to Chelsea Hansel in the amount of $965 during the audit period. Ms. Hansel is another clerical employee. Ms. Hansel’s PMI enrollment was delayed due to some background investigation. Respondent paid Ms. Hansel for work she completed prior to enrollment. The direct payment to Ms. Hansel constitutes uninsured payroll. The Department correctly calculated the penalty associated with the payment to Chelsea Hansel. The correct penalty amount to be imposed against Respondent for failure to secure payment of workers’ compensation coverage for its employees (Gonzalez, Lopez, and Chelsea Hansel) during the audit period in connection with SWO 16-198-1A is $187.80.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Department of Financial Services, Division of Workers’ Compensation, finding that Royal Roofing and Restoration, Inc., violated the workers’ compensation insurance law and, in DOAH Case No. 17-0879, assessing a penalty of $770.60; and in DOAH Case No. 17-1558, assessing a penalty of $187.80. DONE AND ENTERED this 24th day of January, 2018, in Tallahassee, Leon County, Florida. S SUZANNE VAN WYK 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 24th day of January, 2018.
The Issue Whether Respondents violated the provisions of chapter 440, Florida Statutes, by failing to secure the payment of workers' compensation coverage, as alleged in the Stop-Work Orders, and, if so, what penalty is appropriate.
Findings Of Fact The Department is the state agency charged with enforcing the requirement of chapter 440, Florida Statutes, that employers in Florida secure workers' compensation coverage for their employees. § 440.107(3), Fla. Stat. Respondents are gas station/convenience stores located in South Florida. Northlake was created by Nazma Akter on May 6, 2014. MB was created by Ms. Akter on March 23, 2010. Congress Valero was created by Muhammad Saadat on July 21, 2011. Hena was created by Ms. Akter and Abu Ahsan on December 14, 2011. Hayma was created by Ms. Akter on December 14, 2011. Blue Heron was created by Ms. Akter on August 4, 2009. At all times relevant hereto, Respondents were duly-licensed to conduct business in the state of Florida. On February 2, 2015, the Department's Compliance Investigator Robert Feehrer, began a workers' compensation compliance investigation of Gardenia, LLC. Investigator Feehrer called the number listed for Gardenia, LLC, and was provided with a corporate office address. On February 10, 2015, upon arrival at Gardenia, LLC's, corporate office located at 165 US Highway 1, North Palm Beach, Florida, 33408, Investigator Feehrer spoke with Operations Manager Mohammad Hossain. Mr. Hossain stated that Gardenia, LLC, was a paper corporation and existed only for the purpose of paying unemployment taxes on the "six stores." Mr. Hossain went on to provide Investigator Feehrer with a list of Respondents and names of the employees that worked at each store. As an employee of Gardenia, LLC, and Respondents, Mr. Hossain's statements are party opponent admissions and bind Respondents. Lee v. Dep't of Health & Rehab. Servs., 698 So. 2d 1194, 1200 (Fla. 1997). With Mr. Hossain's statements and the list of Respondents' employees, Investigator Feehrer then consulted the Division of Corporations website, www.sunbiz.org, and confirmed that Respondents were current, active Florida companies. Investigator Feehrer then consulted the Department's Coverage and Compliance Automated System ("CCAS") for proof of workers' compensation coverage and exemptions associated with Respondents. Investigator Feehrer's CCAS search revealed that Respondents had no workers' compensation policies and no exemptions. On February 24, 2015, Investigator Feehrer conducted site visits at each of the six stores. Ms. Akter and Mr. Hossain accompanied Investigator Feehrer during these site visits. At all times material hereto, Ms. Akter was a corporate officer or managing member of each of the six Respondents. Muhammed Saadat and Abu Ahsan were corporate officers or managing members of Congress Valero, Hena, and Blue Heron. Kazi Ahamed was a corporate officer or managing member of Congress Valero and Hayma. Kazi Haider and Mohammed Haque were managing members of Hayma. All received compensation from the companies with which they were involved. Although Investigator Feehrer only personally observed one employee working at each location during his site visits, the payroll records revealed that at least four employees (including corporate officers or managing members without exemptions) received compensation for work at each location during the relevant period. Investigator Feehrer required additional information to determine compliance, and with Respondents' permission, contacted Respondents' accountant. Investigator Feehrer met with the accountant at least two times to obtain relevant information prior to March 30, 2015. Upon Ms. Akter's authorization, the accountant provided tax returns and payroll information for Respondents' employees. Information from Ms. Akter and Mr. Hossain also confirmed the specific employees at each of the six stores during the period of March 30, 2013, through March 30, 2015. On March 30, 2015, based on his findings, Investigator Feehrer served six Stop-Work Orders and Orders of Penalty Assessment. The Stop-Work Orders were personally served on Ms. Akter. Mr. Hossain was present as well and confirmed the lists of employees for each of the six stores were accurate. In April 2015, the Department assigned Penalty Auditor Christopher Richardson to calculate the six penalties assessed against Respondents. Respondent provided tax returns for the audit period and payroll transaction details were provided, as well as general ledgers/breakdowns, noting the employees for each Respondent company. Based on Investigator Feehrer's observations of the six stores on February 24, 2015, Auditor Richardson used the classification code 8061 listed in the Scopes® Manual, which has been adopted by the Department through Florida Administrative Code Rule 69L-6.021(1). Classification code 8061 applies to employees of gasoline stations with convenience stores. Classification codes are four-digit codes assigned to various occupations by the National Council on Compensation Insurance to assist in the calculation of workers' compensation insurance premiums. In the penalty assessment, Auditor Richardson applied the corresponding approved manual rate for classification code 8061 for the related periods of non-compliance. The corresponding approved manual rate was correctly utilized using the methodology specified in section 440.107(7)(d)1. and rule 69L-6.027 to determine the final penalties. The Department correctly determined Respondents' gross payroll pursuant to the procedures required by section 440.107(7)(d) and rule 69L-6.027. On January 14, 2016, the Department served the six Amended Orders of Penalty Assessment on Respondents, assessing penalties of $1,367.06 for Northlake, $9,687.00 for MB, $12,651.42 for Congress Valero, $18,508.88 for Hena, $7,257.48 for Hayma, and $4,031.60 for Blue Heron. The Department has demonstrated by clear and convincing evidence that Respondents were engaged in the gasoline station, self-service/convenience store industry in Florida during the periods of noncompliance; that Respondents failed to secure the payment of workers' compensation for their employees, as required by Florida's Workers' Compensation Law; and that the Department correctly utilized the methodology specified in section 440.107(7)(d)1. to determine the appropriate penalties.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a consolidated final order upholding the Stop-Work Orders and the Amended Orders of Penalty Assessment in the amounts of $1,367.06 for Northlake Mobile Enterprises, Inc.; $9,687.00 for MB Food and Beverage, Inc.; $12,651.42 for Congress Valero, Inc.; $18,508.88 for Hena Enterprises, Inc.; $7,257.48 for Hayma Enterprises, Inc.; and $4,031.60 for Blue Heron BP, Inc. DONE AND ENTERED this 16th day of June, 2016, in Tallahassee, Leon County, Florida. S MARY LI CREASY 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 16th day of June, 2016.
The Issue The issue is whether The Department of Financial Services properly imposed a Stop-Work Order and Amended Order of Penalty Assessment pursuant to the requirements of Chapter 440, Florida Statutes.
Findings Of Fact The Division is charged with the regulation of workers' compensation insurance in the State of Florida. Petitioner L and W Plastering and Drywall Services, Inc., (L and W Plastering) is a corporation located in Jacksonville, Florida, and is engaged in the business of providing drywall installation. Allen DiMaria is an investigator employed by the Division. His duties include making site visits at locations where work is being conducted and determining whether the employers in the state are in compliance with the requirements of the workers' compensation law and related rules. On June 5, 2006, Mr. DiMaria visited a commercial job site at 9150 Baymeadows Road, Jacksonville, Florida, and observed 15 individuals at the site. Mr. DiMaria interviewed the individuals and completed a Field Interview Worksheet, recording the names of the individuals who identified themselves as employees of L and W. Mr. DiMaria spoke to the foreman of the crew requesting proof of insurance. He did not receive any such proof on that date. He also checked the database in the Coverage and Compliance Automated System, "C-CAS", and found no proof of coverage nor an exemption for L and W Plastering. After conferring with his supervisor, Mr. DiMaria issued a Stop-Work Order on June 6, 2006. On June 7, 2006, Mr. DiMaria received a certificate of insurance from Petitioner, naming First Financial Employee Leasing Company (First Financial) as the insured. First Financial is a professional employee organization which provides workers' compensation coverage, human resource identification, and other assistance to their clients. L and W was a client company of First Financial. The certificate of insurance received by Mr. DiMaria states that coverage is extended to the employees leased to L and W. William Yocum is the compliance manager of First Financial. Mr. Yocum confirmed that L and W entered into a standard leasing agreement contract with First Financial and that only employees of First Financial leased to L and W Plastering were covered by the workers' compensation insurance provided by First Financial. Mr. DiMaria then contacted First Financial, which sent him a list of employees leased from First Financial to Petitioner as of June 5, 2006. He then compared the names on the list received from First Financial with the names from the field worksheet he completed at the jobsite. His review revealed that 10 of the employees listed on his worksheet did not appear on the list of employees leased by L and W Plastering from First Financial. On June 7, 2006, Mr. DiMaria also sent Petitioner a request for business records for the purpose of calculating a penalty for lack of coverage. Petitioner did not produce business records as requested. On June 27, 2006, Mr. DiMaria issued an Amended Order of Penalty Assessment to Petitioner for $553,628.37. On November 6, 2006, Mr. DiMaria issued a second Amended Order of Penalty Assessment in the amount of $46,259.07. The amount of the penalty was imputed using the statewide weekly average wage that was in effect at the time of the issuance of the Stop-Work Order. Through imputation of payroll for the ten employees, he calculated a penalty for the time period beginning March 1, 2006, the date Petitioner incorporated. Using rates from an approved manual, Mr. DiMaria assigned a class code to the type of work performed by Petitioner and multiplied the approved manual rate with the imputed payroll per one hundred dollars, then multiplied all by 1.5. 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.
Recommendation is, Based upon the Findings of Fact and Conclusions of Law, it RECOMMENDED: That the Division of Workers' Compensation enter a Final Order upholding the Amended Order of Penalty Assessment issued November 6, 2006, assigning a penalty of $46,259.07, and the Stop-Work Order issued to Petitioner on June 6, 2006. DONE AND ENTERED this 16th day of March, 2007, in Tallahassee, Leon County, Florida. S BARBARA J. STAROS 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 16th day of March, 2007. COPIES FURNISHED: Douglas D. Dolan, Esquire Department of Financial Services Division of Workers' Compensation 200 East Gaines Street Tallahassee, Florida 32399 James J. Egan, Esquire Law Office of James J. Egan, P.A. 4950 Beach Boulevard, Jacksonville, Florida 32207 Honorable Alex Sink Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Daniel Y. Sumner, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
The Issue Whether Respondent violated the provisions of chapter 440, Florida Statutes (2016), by failing to secure the payment of workers' compensation coverage, as alleged in the Stop-work Order.1/
Findings Of Fact The Department is the state agency responsible for enforcing the requirement of chapter 440 that employers in Florida secure the payment of workers' compensation coverage for their employees and corporate officers. § 440.107, Fla. Stat. Respondent, M.C. Jennings Jr. Construction Corp., is an active Florida for-profit corporation with its principal office located at 3125 Mundy Street, Miami, Florida 33133. Miles Jennings, Jr., is Respondent's president and registered agent. Respondent admits that during the time period of January 8, 2014, to January 7, 2016, Respondent was a business engaged in the construction industry. The Investigation On January 6, 2016, the Department's compliance investigator, Humberto Rivero, conducted a compliance check at Respondent's business address in response to a public referral. Prior to visiting the business, Mr. Rivero checked the Division of Corporations' website to obtain the federal employee identification number and information on the corporate officers. After this, Mr. Rivero searched the Coverage and Compliance Automated System ("CCAS") to verify whether or not Respondent is covered with workers' compensation insurance and whether there is an exemption for the corporate officers. Mr. Rivero also searched the National Council on Compensation Insurance ("NCCI"). Mr. Rivero routinely checks for coverage before going out for a site visit in response to public referrals. Upon searching the NCCI database and the CCAS database, Mr. Rivero learned that Respondent had no workers' compensation coverage and so the referral appeared to be accurate. Mr. Rivero also determined there were no exemptions. Next, Mr. Rivero arrived at the business address for Respondent, went into a fenced yard, up the steps to a trailer, and identified himself and the reason he was there. Mr. Rivero described the office trailer as the type he goes into on construction projects. There was a desk, manuals, schedules, and drawings or blueprints on a rack. Mr. Rivero did not personally observe any construction activity at the site. Mr. Rivero spoke with Shawn Denise Welch-Perryman. Ms. Welch-Perryman indicated she did not have access to information on workers' compensation and could not get Mr. Jennings because he was in a meeting and could not to be disturbed. Ms. Welch-Perryman said Ms. Hallman, the property manager for Respondent, may be able to help. Mr. Rivero contacted Darlene Hallman by telephone. Ms. Hallman indicated she did not have access to information on workers' compensation. Ms. Hallman admitted she is an employee of Respondent and has been there for several years. Ms. Hallman said she gets paid by company check, but did not want to disclose how much. After this, Mr. Rivero interviewed Ms. Welch-Perryman, as he had with Ms. Hallman, and Ms. Welch-Perryman admitted to being an employee of Respondent. Ms. Welch-Perryman also gets paid by company check. Mr. Rivero was provided with the name Ed Fowler, Respondent's insurance agent. Mr. Rivero talked to Mr. Fowler to check on whether Respondent was covered. Mr. Fowler said the company did not have coverage, but it was working on it. This information was consistent with the searches Mr. Rivero performed prior to his visit at Respondent's business location. Mr. Rivero told Ms. Welch-Perryman to have Mr. Jennings call him by the end of that day, January 6th. Mr. Jennings did not call Mr. Rivero on the 6th. On January 7, 2016, Mr. Rivero spoke with Mr. Jennings by phone. During this conversation, Mr. Jennings confirmed that the two women were his employees and he did not have insurance, but was working on securing it. Mr. Jennings agreed to meet with Mr. Rivero at the office trailer at 1 p.m. When Mr. Rivero returned that afternoon, the site was locked with the fence closed by padlock. Mr. Rivero called Ms. Welch-Perryman and Ms. Hallman to see why the site was locked and left messages, but received no response. Mr. Rivero called his supervisor, Scarlet Aldana, to inform her of what he found. She advised Mr. Rivero to call Mr. Jennings and tell him of the consequences of not being there and not having insurance. Mr. Rivero called Mr. Jennings and left a message. After waiting about 15 minutes, Mr. Rivero called his supervisor again to explain the situation. Ms. Aldana authorized a Stop- work Order to be issued and posted in a prominent place. Mr. Rivero posted the Stop-work Order on Respondent's mailbox and photographed it. While at the business location, Mr. Rivero was with senior investigator Julio Cabrera. Mr. Rivero was directed by Mr. Cabrera to photograph a dump truck on site with a general contractor's number on it. According to Mr. Rivero, there were many more pieces of equipment, but he focused on photographing the posting of the Stop-work Order and the dump truck. According to the records of the Department of Business and Professional Regulation, an active general contractor license number belongs to Mr. Jennings and Respondent. On January 15, 2016, Mr. Jennings contacted Mr. Rivero to say he had come into compliance by purchasing coverage for nine employees. Mr. Rivero asked for the broker's name and phone number so he could verify coverage. Mr. Rivero spoke by phone with Stan Shelton at Madison Insurance Company. Mr. Shelton verified the company had coverage for nine employees, paid a down payment of $500, and the premium was $31,763. On January 19, 2016, Mr. Rivero met with Mr. Jennings and went over the business records request, informing Mr. Jennings that in order to calculate a penalty, the Department needed certain records. Mr. Jennings was informed of the ten business days he had to submit the records. Penalty Calculation Penalty Auditor Sarah Beal was assigned to calculate the penalty in this case. Ms. Beal did not receive any records from Respondent in response to the business records request. Without any records, Ms. Beal had to impute the gross payroll which is equal to two times the average weekly wage that was in effect when the Stop-work Order was issued. Ms. Beal determined the period of noncompliance to be the full two years of January 8, 2014, to January 7, 2016. Ms. Beal identified the employees on the penalty worksheet from the investigator's on- site observations and narrative. Based on Mr. Rivero's observations on January 6, 2016, and the information he had gathered, Ms. Beal initially used the classification code 8810 listed in the Scopes® Manual, which has been adopted by the Department through Florida Administrative Code Rule 69L-6.021(1). Classification codes are four-digit codes assigned to various occupations by the NCCI to assist in the calculation of workers' compensation insurance premiums. Classification code 8810 applies to clerical workers and Ms. Beal preliminarily used this code for Ms. Hallman, Ms. Welch-Perryman, and Mr. Jennings. Ms. Beal then utilized the corresponding approved manual rates for those class codes and the period of noncompliance to determine a penalty, which she submitted to her supervisor for review. Ms. Beal was subsequently directed to change the class code for Mr. Jennings to Scopes Code 5606, a construction class code for construction foreman/project manager. On April 8, 2016, based on Ms. Beal's re-calculation, using class code 5606 for Mr. Jennings, the Department issued an Amended Order of Penalty Assessment to Respondent. The Amended Order of Penalty Assessment assessed a penalty of $8,753.66.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order upholding the Stop-work Order and the Amended Order of Penalty Assessment and assess a penalty against Respondent in the amount of $8,753.66. DONE AND ENTERED this 27th day of June, 2016, in Tallahassee, Leon County, Florida. S MARY LI CREASY 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 27th day of June, 2016.
The Issue The issues in this case are whether Respondent failed to provide workers' compensation coverage, and, if so, what penalty should be imposed.
Findings Of Fact Abash is a Florida corporation engaged in the business of demolition. James McCarthy (Mr. McCarthy) is the president and only officer of Abash. The Department received a call from the City of Fort Myers that Abash was doing demolition work at the location of a former Publix on Cleveland Avenue in Fort Myers, Florida, and that it was believed that Abash did not have workers' compensation coverage. Carol Porter, the supervisor for District 7 of the Department, assigned Jack Gumph (Mr. Gumph), a compliance investigator for the Department, to investigate the matter. On September 10, 2010, Mr. Gumph went to 3255 South Cleveland Avenue, where the former Publix was located. On arriving at 9:55 a.m., he saw a large truck at the site with the name Abash on its side. He went inside the structure and observed two Abash employees at work with a lift truck. One employee, Vincent Canzone (Mr. Canzone), was taking down light fixtures, and another employee, Dan Myers (Mr. Myers), was operating the truck. Mr. Gumph consulted the Coverage and Compliance Automated System (CCAS) to determine if Abash had workers' compensation coverage. The database showed that Abash had had workers' compensation coverage effective June 2, 2010, but that coverage had been cancelled September 7, 2010. Mr. Gumph checked the Department of State records and learned that Mr. McCarthy was the sole officer and director of Abash. Mr. Gumph again checked CCAS and learned that there was no exemption from coverage for Mr. McCarthy.2/ Mr. Gumph checked the database for the National Council of Compensation Coverage and learned that Abash had had workers' compensation coverage with National Union Fire Insurance Company of Pittsburg, Pa. (National Union Fire), but that the coverage had been cancelled September 7, 2010. Mr. McCarthy had received a notice of cancellation from National Union Fire, but he thought that they would give Abash a grace period and allow Abash to pay for back-coverage as long as Abash did not have any claims for the period in which there was no coverage in place. He was looking into alternative methods of coverage, including using a payroll service. Mr. McCarthy conceded at the final hearing that if an employee had been injured during the non-covered period that National Union Fire would not have honored the claim. Abash did enter into an employee leasing contract with Southeast Personnel Leasing on September 10, 2010; however, no evidence was presented establishing the time of day that Abash entered into the employee leasing contract, and the contract with the employee leasing company does not specify the time of day when Abash entered into the contract. The list of employees covered by the employee leasing contract does not include Mr. Myers, who was working for Abash when Mr. Gumph visited the work site. Mr. Gumph issued a Stop-Work Order and posted it on the job site the day that he visited the site. He called Abash and spoke with a secretary who advised that Mr. McCarthy was not in the office. Mr. Gumph mailed a copy of the Stop-Work Order and a Request for Production of Business Records for Penalty Assessment Calculation to Abash on September 10, 2010. Abash received the documents on September 14, 2010. Abash produced copies of its businesses records to the Department. Lynne Murcia (Ms. Murcia), a penalty calculator for the Department, calculated the penalty assessment based on Abash's business records. She reviewed Abash's records for the past three years and determined that the period in which there was no workers' compensation coverage was September 7 to September 10, 2010. Abash's financial records did not reveal that Mr. Canzone and Mr. Myers had been employees for Abash other than the day that Mr. Gumph visited the job site. The financial records identified seven other employees during the period of non-coverage, but there were no transactions listed for these employees for September 10, 2010. Ms. Murcia assigned a class code to each employee based on the type of work they did. The class codes are specified in the Florida Contracting Classification Premium Adjustment Program, which is published in the Florida exception pages of the National Council on Compensation Insurance, Inc. (NCCI), Basic Manual (October 2005 ed.). For seven employees, Ms. Murcia assigned a class code of 5445, which is for the installation of wallboard within buildings. Although the work was demolition of wallboards, the same class code applies. For two employees, a class code of 8742 was assigned. This class code deals with outside sales. One employee was assigned class code 5221, which deals with concrete work. Mr. McCarthy agreed at the final hearing that the class codes assigned were appropriate. The gross payroll is determined for each employee and divided by 100.3/ The resulting quotient is multiplied by the approved minimum rate for the class code to determine the premium that should have been paid for coverage. Ms. Murcia listed the premium that should have been paid for the non-covered period for all Abash employees, which was $170.48. The premium was multiplied by 1.5 to determine the penalty assessment for each employee, which Ms. Murcia determined was $255.75; however, section 440.107(7)(d)1. provides that the minimum penalty that can be assessed is $1,000.00. Because the employee leasing contract provided coverage for Mr. Canzone on September 10, 2010, the penalty calculation should exclude Mr. Canzone. There was no coverage for Mr. Myers on September 10, 2010. The penalty assessment for Mr. Myers and Mr. Canzone was $16.88 each. The penalty assessments based on the remaining employees were for days other than September 10, 2010. Excluding Mr. Canzone from the penalty assessment results in a penalty assessment of $238.87. However, the statutory minimum assessment is $1,000.00. On September 15, 2010, Mr. McCarthy went to District 7's office, where he was personally served with the Stop-Work Order, and an Amended Order of Penalty Assessment, assessing the penalty at $1,000.00 Mr. McCarthy paid the penalty.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Abash failed to secure workers' compensation coverage and assessing a penalty of $1,000.00, which has been paid by Abash. DONE AND ENTERED this 22nd day of July, 2011, in Tallahassee, Leon County, Florida. S SUSAN B. HARRELL 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 22nd day of July, 2011.
The Issue The issues in this case are whether Respondent failed to secure workers' compensation coverage for its employees, as Petitioner alleges; and, if so, whether a penalty based upon the unpaid premium should be assessed against Respondent.
Findings Of Fact Petitioner Department of Financial Services, Division of Workers' Compensation ("DFS" or the "Department"), is the state agency responsible, among other things, for the enforcement of the workers' compensation insurance coverage requirements established in chapter 440, Florida Statutes. Respondent Ameribuild Construction Management, Inc. ("Ameribuild"), is a Florida corporation having its principal office in Boca Raton, Florida. Brandon L. Roth ("Roth") is the owner and qualifier, and a corporate officer, of Ameribuild. At all relevant times, Ameribuild was licensed to engage in construction activity in the state of Florida. In the instant case, DFS alleges that Ameribuild, as the general contractor for a construction project in Miami, failed to secure workers' compensation insurance for Roth and six employees (the "Workers") of CJ Meeko, LLC ("CJM"), a business which, DFS alleges, was a subcontractor of Ameribuild on the project in question. In its defense against this allegation of noncompliance, Ameribuild raises two disputes of material fact, asserting that, contrary to DFS's preliminary determinations, (i) Roth did not perform services for remuneration for Ameribuild, and (ii) CJM was not Ameribuild's subcontractor but was, rather, in a direct contractual relationship with Prestige Imports Outparcel LLC ("Prestige"), the owner of the project. Based on these exculpatory (but disputed) factual allegations, Ameribuild argues that, as a matter of law, neither Roth nor any of the Workers was a statutory "employee" (a term of art in this context) of Ameribuild, and thus, to the point, Ameribuild was not obligated to secure compensation for these individuals. Of the material facts in dispute, the question of whether CJM was a subcontractor of Ameribuild is by far the most significant, as the Workers account for $132,593.32 (or 96 percent) of the $137,719.54 penalty that DFS seeks to impose. The Department, which has the burden of proving the affirmative of this crucial question, relies largely (although not entirely) on the hearsay statements of Roth and Eugene Parker ("Parker"), the latter an employee of Ameribuild at all material times who was foreman or superintendent of the subject project. These statements are admissible as substantive evidence under the "admissions" exception to the hearsay rule.1/ DFS introduced the statements of Roth and Parker through its investigator, Anthony Vinci, to whom (according to Mr. Vinci) the statements were made. Mr. Vinci also testified about statements made to him by Jack Rosales, the owner of CJM (and one of the six Workers mentioned above). To the extent offered for the truth of the matters asserted, Mr. Rosales's out-of-court statements to Mr. Vinci constitute hearsay that does not fall within any recognized exception. The undersigned has not made any findings of fact based, in whole or in part, on Mr. Rosales's hearsay statements.2/ Roth and Mr. Rosales testified at hearing. Both men denied that CJM had been Ameribuild's subcontractor, contradicting the section 90.803, Florida Statutes, admissions to which Mr. Vinci attested. Because the resolution of this particular dispute turns on credibility determinations, the undersigned will discuss the testimony itself in somewhat more detail than is usually warranted. On May 31, 2017, Mr. Vinci performed a random worksite inspection at 15050 Biscayne Boulevard, North Miami Beach, Florida, where an automobile dealership was being constructed on a site that had been occupied by a drugstore. He immediately observed several men performing drywall work and debris removal. The first person to whom Mr. Vinci spoke was Mr. Rosales, who identified himself as the owner of CJM and confirmed that the five laborers presently at work were CJM's employees. Mr. Vinci immediately conducted on online database search and discovered that Mr. Rosales did not have an active exemption for himself or workers' compensation coverage for any of CJM's employees at the worksite. Parker, the Ameribuild employee, was present at the worksite, too, when Mr. Vinci arrived. As the project foreman, his duties included coordinating the job and making sure that the work flow continued. Parker told CJM's employees what to do. He opened and closed the worksite daily, coordinated all the subcontractors, and kept a log of persons entering and leaving the area. Parker, in short, was "in charge" on site. Mr. Vinci interviewed Parker, who acknowledged being an employee of Ameribuild and identified CJM as Ameribuild's subcontractor. Parker named Roth as Ameribuild's owner and gave Mr. Vinci Roth's name and number. Before calling Roth, Mr. Vinci went to his car and conducted an online search of Ameribuild's records. He learned that Ameribuild had workers' compensation coverage through a leasing company, which showed coverage for Parker. The leasing roster, however, did not cover Roth or any of CJM's employees. Mr. Vinci then got Roth on the phone to notify him that Ameribuild had not secured workers' compensation coverage for all of its employees and that, consequently, the Department would enforce compliance, including through the issuance of a Stop-Work Order ("SWO"). At hearing, Roth denied having spoken to Mr. Vinci at this time.3/ Mr. Vinci's contemporaneous notes, however, corroborate his recollection of the discussion at issue, and, equally important, the conversation fits comfortably into the undisputed chain of events, whereas its nonexistence would be harder, albeit not impossible, to reconcile with the parties' subsequent conduct. The undersigned finds that, in fact, Mr. Vinci and Roth spoke on the telephone on the afternoon of May 31, 2017. As recounted by Mr. Vinci, the ensuing discussion was, for the most part, about what you'd expect. After introducing himself, Mr. Vinci asked Roth about CJM and whether its Workers were covered. When Roth replied that Mr. Rosales had an exemption from workers' compensation, which he (Roth) had seen, Mr. Vinci informed him that, actually, Mr. Rosales did not have one. Asked whether he (Roth) had an exemption, Roth answered that he would need to check. In response to another of Mr. Vinci's inquiries, Roth told the investigator (according to the latter's contemporaneous notes) that he (Roth) did not receive any remuneration from Ameribuild. According to Mr. Vinci, whose testimony in this regard is hotly disputed, Roth stated that he had hired Mr. Rosales's company, CJM, as Ameribuild's subcontractor on the project in question. Armed with this information, DFS prepared a SWO for issuance to Ameribuild, which commanded Ameribuild to cease all business operations at the worksite and assessed a monetary penalty (exact amount to be determined) equal to two times the premium Ameribuild would have paid to provide the required coverage during the preceding two years. Mr. Vinci called Roth to tell him about the SWO and make arrangements for the service thereof. (Roth's denial of his participation in this conversation is rejected as unpersuasive.) Roth was informed of the requirements for obtaining a conditional release from the SWO so that Ameribuild could resume operations at the worksite pending a final release upon compliance and payment in full of the assessed penalty. Roth agreed to meet Mr. Vinci the following day at the Department's Miami office. That meeting took place as scheduled. Mr. Vinci personally served Roth with the SWO and a Request for Production of Business Records for Penalty Assessment Calculation ("BRR"). Roth then paid $1,000.00 towards the penalty, which had yet to be calculated, and delivered a signed "reduction-of-workforce" letter, i.e., a sworn statement, on Ameribuild letterhead, promising DFS that "Ameribuild Construction Management will no longer permit CJ Meeko LLC or his employees [to] work on the jobsite @ 15050 Biscayne Blvd., North Miami Beach, FL 33132 until CJ Meeko LLC is in compliance with Florida State Law." Upon receipt of Ameribuild's check and reduction-of-workforce letter, the Department executed an Agreed Order of Conditional Release from Stop-Work Order, which authorized Ameribuild to resume operations at the worksite. There is no evidence suggesting that, during this meeting on June 1, 2017, Mr. Vinci or anyone else interrogated Roth, who could have remained silent and refused to comment on DFS's allegations, given that it would be DFS's burden to prove the charges, were Ameribuild to request a hearing. Roth, however, volunteered his opinion that if CJM lacked coverage (as DFS alleged), then Mr. Rosales must have made an "honest mistake" because he (Roth) sincerely believed that Mr. Rosales had applied for and obtained an exemption. The point of this statement, obviously, was not to deny the violation, but to minimize it as having been neither knowing nor intentional. Roth, it appears, was offering up facts that he probably hoped would mitigate the penalty. Regardless, more telling is what Roth——in responding to the accusation that Ameribuild was responsible for its subcontractor's (CJM's) failure to secure compensation——did not say. If CJM really were not Ameribuild's subcontractor, it would be expected that Roth would protest the Department's misunderstanding of this basic fact, and state that, in fact, CJM was Prestige's contractor. While Roth's silence in this regard perhaps does not rise to the level of an evidentiary admission,4/ the undersigned finds that his failure then (or later) to inform the Department of the "true" contractual relationships is suspiciously inconsistent with Ameribuild's current litigating position. If Ameribuild did not have a contract with CJM, then Roth, if he were not going to keep quiet, should have been making that point early and often. In the months that followed, Ameribuild provided documents to DFS responsive to the BRR, which DFS deemed insufficient for purposes of determining Ameribuild's payroll for the audit period of June 1, 2015, through May 31, 2017. In such situations, where the records are insufficient to establish actual payroll, the Department is authorized to base its penalty assessment upon an "imputed payroll." Consequently, using the methodology specified in section 440.107(7)(d)1. and (e) and Florida Administrative Code Rule 69L-6.027, DFS determined (for the entire audit period) Ameribuild's imputed payroll, which is the compensation that Ameribuild is deemed to have paid the Workers and Roth. It is unnecessary in this case to make detailed findings regarding the assumptions behind Ameribuild's imputed payroll figures because Ameribuild does not dispute them or the amount of the resulting penalty ($137,719.54), which was set forth in an Amended Order of Penalty Assessment served on November 6, 2017. Rather, Ameribuild maintains that DFS has failed to prove the alleged violations, meaning there can be no penalty, which makes the imputed payroll irrelevant. If, on the other hand, Ameribuild were found to have violated a duty to secure compensation for Roth and Workers, which Ameribuild of course believes should not happen, then Ameribuild would concede that the imputed payroll and concomitant penalty are correct. As mentioned above, it is Ameribuild's contention that the Workers were not "employees" of Ameribuild for workers' compensation purposes because CJM was under contract, not to Ameribuild, but to the owner of the project, Prestige. Both Roth and Mr. Rosales testified about this purported contract; under the CJM-Prestige agreement as they described it,5/ the Workers might not have been Ameribuild's employees.6/ Ameribuild sought to introduce a copy of the contract as proof of the fact that CJM was Prestige's contractor. The Department objected because Ameribuild had not disclosed the contract as an exhibit until a few days before the hearing, long past the deadline established in the Order of Pre-hearing Instructions. Ameribuild could provide no explanation for the late disclosure. Wanting to avoid the exclusion of evidence that could be dispositive, but unwilling to countenance the prejudice DFS might suffer if the surprise exhibit were admitted, the undersigned ruled that the document would be received on the condition that the hearing be recessed for a reasonable, but brief, period so that DFS could depose the appropriate person(s) at Prestige about the purported CJM-Prestige agreement, and then supplement the record with the deposition(s). Ameribuild, however, elected to withdraw the exhibit to prevent the Department from obtaining Prestige's testimony about the alleged contract. Thus, Ameribuild neither offered (nor proffered) the purported CJM-Prestige agreement, which, accordingly, is not in the evidentiary record. The undersigned probably would be permitted to draw an adverse inference from Ameribuild's counterintuitive failure to introduce the written agreement, which was obviously available and within Ameribuild's immediate control, and which (if genuine) would be, if not dispositive, certainly persuasive exculpatory evidence directly rebutting the Department's case-in-chief. The undersigned reasonably could infer from the totality of the circumstances that Ameribuild had reason to believe Prestige would not recognize and authenticate the purported contract if asked about it under oath in deposition, which reason being (need it be said?) that the purported contract is a fake. The undersigned declines to draw such an inference. Instead, the undersigned finds that, without the contract as corroborating evidence, Ameribuild has failed to present proof sufficient to undermine the strength of the Department's prima facie case. DFS has carried its burden of proving, by clear and convincing evidence, that CJM was Ameribuild's subcontractor. On the question of whether Roth was an employee of Ameribuild for compensation purposes during the period when his name did not appear on the coverage roster, however, the undersigned finds that the Department failed to carry its burden of proof. Roth testified at hearing that he had received no remuneration from Ameribuild during the months in 2016 and 2017 when he was not included in the company's compensation coverage, which testimony was consistent with his prior statement to Mr. Vinci in this regard. Other documentation in evidence shows that in 2015, when Roth received remuneration from Ameribuild, he was also provided workers' compensation coverage, through South East Personnel, Inc., a leasing company. While the evidence fails clearly to establish that Roth did not receive remuneration from Ameribuild, it fails clearly and convincingly to prove that he did. It is determined, therefore, that Roth was not an uncovered employee during the audit period. The proposed penalty must be adjusted to remove the amount attributable to Roth——$5,126.22. Ameribuild's penalty for noncompliance, based on the Workers' imputed payroll, should be $132,593.32.
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 finding Ameribuild Construction Management, Inc., in violation of its obligation to secure workers' compensation and imposing a penalty of $132,593.32 for such noncompliance. DONE AND ENTERED this 6th day of September, 2018, in Tallahassee, Leon County, Florida. S JOHN G. VAN LANINGHAM 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 6th day of September, 2018.
