TIME AUTO TRANSPORTATION, INC., AND TIME AUTO TRANSPORT, L.S., a single employer v. National Labor Relations Board

1
RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
ELECTRONIC CITATION: 2004 FED App. 0236P (6th Cir.)
File Name: 04a0236p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
TIME AUTO
TRANSPORTATION, INC., AND
TIME AUTO TRANSPORT, L.S.,
a single employer,
Petitioner/
Cross-Respondent,
v.
NATIONAL LABOR RELATIONS
BOARD,
Respondent/
Cross-Petitioner.
X
-
-
-
->
,
-
-
-
-
-
-
-
-
-
-
N
Nos. 03-1194/1271
On Petition for Review and Cross-Application
for Enforcement of an Order of the
National Labor Relations Board.
Nos. 7-CA-43641-1; 7-CA-43641-2.
Argued: June 8, 2004
Decided and Filed: July 23, 2004
2 Time Auto Transp. v. NLRB Nos. 03-1194/1271
*The Honorable Gordon J. Quist, United States District Judge for the
W estern District of Michigan, sitting by designation.
Before: MARTIN and SUTTON, Circuit Judges; QUIST,
District Judge.*
_________________
COUNSEL
ARGUED: William L. Hooth, COX, HODGMAN &
GIARMARCO, Troy, Michigan, for Petitioner. Richard A.
Cohen, NATIONAL LABOR RELATIONS BOARD,
Washington, D.C., for Respondent. James B. Coppess, AFL-
CIO LEGAL DEPARTMENT, Washington, D.C., for
Amicus Curiae. ON BRIEF: William L. Hooth, COX,
HODGMAN & GIARMARCO, Troy, Michigan, for
Petitioner. Richard A. Cohen, Aileen A. Armstrong,
NATIONAL LABOR RELATIONS BOARD, Washington,
D.C., for Respondent. James B. Coppess, AFL-CIO LEGAL
DEPARTMENT, Washington, D.C., for Amicus Curiae.
_________________
OPINION
_________________
BOYCE F. MARTIN, JR., Circuit Judge. Time Auto, as
the name is used in this case, refers to Time Auto
Transportation, Inc., and Time Auto Transport, L.S., which,
the parties agree, together constitute a single employer. Time
Auto employed Randy Hill and Ernest Blake, long-haul truck
drivers, under separate independent contractor agreements.
Time Auto concedes that it terminated their contracts based
on Hill’s and Blake’s engagement in activities on behalf of
Local 299, International Brotherhood of Teamsters, AFL-
CIO—which, Time Auto concedes, is a labor organization
within the meaning of section 152(5) of the National Labor
Relations Act. 29 U.S.C. § 152(5). Hill and Blake filed

-- 1 of 3 --

Nos. 03-1194/1271 Time Auto Transp. v. NLRB 3
charges with the National Labor Relations Board challenging
their termination pursuant to provisions of the Act. An
administrative law judge found that because Hill and Blake
were “employees” under the definition provided in the Act,
29 U.S.C. § 152(3), then Time Auto’s treatment and
termination of Hill and Blake were in violation of sections
158(a)(1) and (3) of the Act. A Board majority affirmed that
judgment.
On appeal, the parties stipulate that if this Court agrees that
Hill and Blake are employees of Time Auto, and not
independent contractors, then Time Auto is in violation of the
Act. Thus, the sole issue before this Court is whether Hill and
Blake were “employees” as defined in section 152(3), or
whether they were independent contractors within the
meaning of the 1947 amendment that provides that “[t]he
term ‘employee’ . . . shall not include . . . any individual
having the status of an independent contractor. . . .”
I
Hill and Blake operated equipment, which they leased from
Time Auto pursuant to formal lease agreements, on a full-
time basis. When they entered into the agreements to lease
the equipment, both drivers were required to make down
payments, as well as substantial monthly payments, which
they would forfeit if they were terminated for inadequate
performance. Hill and Blake had no exclusive territory or
customers, and instead serviced the requests of Time Auto
according to a Time Auto dispatcher’s directions. If the
drivers received no direction, then they were ordered to wait,
rather than work independently for individual profit. The
equipment-lease and independent contractor agreements were
terminable at will on five days notice without cause.
According to the testimony of Hill and Blake, and as found
by the Board, this “power of termination . . . was amplified by
the fact that the drivers began with substantial $10,000 down
payments on their equipment, and made substantial monthly
4 Time Auto Transp. v. NLRB Nos. 03-1194/1271
payments, all of which they stood to lose if they did not
perform up to company expectations.” Also, the Board found
that Time Auto expected drivers to meet assigned delivery
dates and times even if doing so required violating federal
restrictions. Blake testified that every driver understood that
if he did not meet these demands then the dispatchers would
“starve [the driver] out”—i.e., not give any assignments —
and Hill testified that Time Auto instructed him to “keep [his]
logs”—i.e., fabricate drive time in order to comply with
federal regulations. Their assertions were supported by the
testimonial evidence of Cynthia Morefield, a former office
manager and controller for Time Auto. The administrative
law judge determined that the statements of Hill, Blake, and
Morefield were credible.
In affirming the decision of the administrative law judge,
the Board conceded that as to “. . . the structure of Hill’s and
Blake’s work relationship with [Time Auto], the balance tips
in favor of finding independent contractor status[,]” but that
“by demanding over-limit drive time and backing that
demand with a threat of job loss, [Time Auto] sought to
exercise a degree of control over the manner of work
performance that [the Board] finds inconsistent with
independent contractor status.” In the single dissent, a Board
member stated that “numerous factors tend to support a
finding of independent contractor status,” and that
[Time Auto] . . . has done virtually everything possible
to structure the relationship with the lease drivers in such
a way as to make clear to all that they are independent
contractors rather than employees. Indeed, it is difficult
to see how, if Hill and Blake are not independent
contractors, there could be any independent contractors
among the drivers in the long-haul trucking industry.
Time Auto makes these same arguments on appeal, stating
that the relationships between Time Auto and Hill and Blake
were structured to be independent contractor relationships,
“as reflected in the Independent Contractor Agreements and

-- 2 of 3 --

Nos. 03-1194/1271 Time Auto Transp. v. NLRB 5
Equipment Lease Agreements entered into by Hill and
Blake.”
Time Auto also asserts that Hill and Blake both operated
through their own corporations (respectively, Four Hill’s
Auto Transportation, Inc., and Dimarlou Enterprise), that they
could hire drivers to work for them, that they were paid on a
percentage basis, and that they were responsible for all of the
costs of operating, maintaining, and repairing their tractors
and trailers. Time Auto made payments to these corporations
rather than to Hill and Blake as individuals. Time Auto
argues that “[t]o the extent that [it] exercised any control over
Hill and Blake, such activity was directed solely at achieving
the ends of performance and ensuring customer
satisfaction. . . . In sum, Hill and Blake operated as the small,
independent businesses they were.”
II
We sustain the findings and conclusions of the Board if
they are “supported by substantial evidence on the record
viewed as a whole.” Universal Camera Corp. v. NLRB, 340
U.S. 474, 493 (1951). We also review the “Board’s
application of the law to particular facts under the substantial
evidence standard.” Turnbull Cone Baking Co. v. NLRB, 778
F.2d 292, 295 (6th Cir. 1985), cert. denied, 476 U.S. 1159
(1986). Substantial evidence is “such relevant evidence as a
reasonable mind might accept as adequate to support a
conclusion.” Consol. Edison Co. v. NLRB, 305 U.S. 197, 229
(1938). In analyzing whether Hill and Blake are employees
or independent contractors, we apply the “right to control
test,” NLRB v. United Ins. Co. of Am., 390 U.S. 254, 256
(1968); Aetna Freight Lines, Inc. v. NLRB, 520 F.2d 928, 930
(6th Cir. 1975), which requires us to consider the total factual
context of employment. Id. As the Supreme Court has made
plain, the determination of “employee” or “independent
contractor” status requires an evaluation of “all incidents of
the work relationship,” with “no one factor being decisive.”
United Ins., 390 U.S. at 258.
6 Time Auto Transp. v. NLRB Nos. 03-1194/1271
Our review of the record as a whole leads us to conclude
that substantial evidence supports the Board’s determination
that Time Auto asserted such control over Hill and Blake as
to make them its employees. While we have considered “all
incidents of the work relationship,” id., we are particularly
persuaded by the at-will nature of the contracts, the
substantial down-payments made by Hill and
Blake—recovery of which depends on employment by Time
Auto—and Time Auto’s instructions to disregard federal
regulations. These factors constitute substantial evidence
supporting the Board’s determination that Hill and Blake are
employees, not independent contractors. See Aetna Freight
Lines, 520 F.2d at 930 (holding that “severe restrictions” on
leasing, the use of lease terminations as discipline, the
“carefully prescribed” time restrictions on deliveries, and the
“‘how to do it’ directions covering other aspects of the
driving operation” indicated heightened control over workers,
thereby making them employees).
We recognize that other factors may arguably suggest a
finding of independent-contractor status—e.g., Hill and Blake
paid for their own expenses, received no company benefits,
and could hire drivers to work for them. However, these
factors are insufficient to undermine our conclusion that
substantial evidence supports the Board’s decision.
III
For the foregoing reasons, we affirm the judgment of the
Board.

-- 3 of 3 --