Dianna Yoder, et al. v. Florida Farm Bureau Casualty Insurance Company, et al.

[DO NOT PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 22-11135
Non-Argument Calendar
____________________
DIANNA YODER,
Individually and on behalf of other similarly situated
KELLEY WILLIAMS,
Individually and on behalf of other similarly situated
JOSHUA DAVIS,
RICHARD BUTTS,
Plaintiffs-Appellants,
CLINT WALDING,
Plaintiff,
versus
FLORIDA FARM BUREAU, et al.
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2 Opinion of the Court 22-11135
Defendants,
FLORIDA FARM BUREAU CASUALTY INSURANCE
COMPANY,
FLORIDA FARM BUREAU GENERAL INSURANCE COMPANY,
SOUTHERN FARM BUREAU LIFE INSURANCE COMPANY,
Defendants-Appellees.
____________________
Appeal from the United States District Court
for the Northern District of Florida
D.C. Docket No. 1:19-cv-00070-AW-GRJ
____________________
Before W ILSON, ROSENBAUM , and JILL PRYOR, Circuit Judges.
PER CURIAM:
Plaintiffs-Appellants appeal the district court’s summary
judgment order holding that they were “independent contractors”
rather than “employees” of the Defendants-Appellees, and there-
fore not entitled to the overtime protections afforded by the Fair
Labor Standards Act (FLSA), 29 U.S.C. § 297. After careful review
of the record, we agree with the district court’s determination and
AFFIRM.
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22-11135 Opinion of the Court 3
I.
Appellants Diana Yoder, Kelley Williams, Joshua Davis, and
Richard Butts are four insurance agents (collectively, the Agents).
Each entered separate contracts with Appellees Florida Farm Bu-
reau Casualty Insurance, Florida Farm Bureau General Insurance
Company, and Southern Farm Bureau Life Insurance Company
(collectively, Farm Bureau) to exclusively sell and service Farm Bu-
reau products. The Agents’ income came exclusively from com-
missions of Farm Bureau products that they issued or renewed.
The Agents operated from Farm Bureau agencies located in offices
that were supplied, operated, and provided by Farm Bureau.1
Following the termination of their contracts, the Agents
sued Farm Bureau claiming entitlement to overtime pay as em-
ployees under the FLSA. Farm Bureau moved for summary judg-
ment, arguing that the Agents were independent contractors under
the FLSA, thus extinguishing any entitlement to overtime pay. In
response, the Agents argued that Farm Bureau controlled every sig-
nificant aspect of their work, and that the Agents had no oppor-
tunity for profit or loss and were not required to personally invest
in materials for work. Thus, they are employees entitled to over-
time pay under the FLSA.
1 The parties dispute this fact, but at summary judgment we construe all facts
in favor of the nonmovant. See Scantland v. Knight, 721 F.3d 1308, 1310 (11th
Cir. 2013).
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The district court granted summary judgment for Farm Bu-
reau, finding the Agents were independent contractors. The dis-
trict court drew guidance from caselaw, analyzed the Scantland v.
Knight, 721 F.3d 1308 (11th Cir. 2013), factors, and found that four
of the factors favored independent contractor status while two,
permanency and integrality, favored employee status. Ultimately,
the court concluded that “[the Agents] chose how to grow their
business. They chose how much of their own money to invest . . . .
They retained discretion to hire staff to help them. In short, they
had substantial control over how they worked and how much they
earned—making them economically independent.” Yoder v. Fla.
Farm Bureau Cas. Ins. Co., No. 1:19-cv-70-AW-GRJ, 2022 WL
1055184, at *10 (N.D. Fla. Mar. 9, 2022).
The Agents timely appealed.
II.
We review an appeal from summary judgment de novo and
apply the same legal standards as the district court. Scantland , 721
F.3d at 1310. “The court shall grant summary judgment if the mo-
vant shows that there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.” Fed.
R. Civ. P. 56(a). “The court must view all evidence most favorably
toward the nonmoving party, and all justifiable inferences are to be
drawn in the nonmoving party’s favor.” Scantland, 721 F.3d at
1310.
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22-11135 Opinion of the Court 5
III.
To determine an individual’s employment status under the
FLSA, “courts look to the ‘economic reality’ of the relationship be-
tween the alleged employee and alleged employer and whether
that relationship demonstrated dependence.” Id. at 1311. “Ulti-
mately, in considering economic dependence, the court focuses on
whether an individual is in business for himself or is independent
upon finding employment in the business of others.” Id. at 1312
(internal quotation marks omitted). Because “a constricted inter-
pretation of the [the FLSA] by courts would not comport with [the
FLSA’s] purpose,” our circuit holds that “[t]he common law con-
cepts of ‘employee’ and ‘independent contractor’ [are] specifically
rejected as determinants of who is protected” by the FLSA. Usery
v. Pilgrim Equip. Co., 527 F.2d 1308, 1311 (5th Cir. 1976).2
We use the following six non-exhaustive Scantland factors to
guide the economic reality inquiry:
(1) the nature and degree of the alleged employer’s
control as to the manner in which the work is to
be performed;
(2) the alleged employee’s investment in equipment
or materials required for his task, or his employ-
ment of workers;
2 Decisions from the former Fifth Circuit predating the close of business on
September 30, 1981, are binding precedent in the Eleventh Circuit. Bonner v.
City of Prichard, 661 F.2d 1206, 1207 (11th Cir. 1981) (en banc).
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6 Opinion of the Court 22-11135
(3) whether the service rendered requires a special
skill;
(4) the degree of permanency and duration of the
work relationship;
(5) the extent to which the service rendered is an in-
tegral part of the alleged employer’s business;
(6) the extent to which the service rendered is an in-
tegral part of the alleged employers’ business.
Scantland, 721 F.3d at 1312.
IV.
The Agents allege two overarching errors with the district
court’s reasoning: first, that drawing guidance from non-FLSA
caselaw was erroneous, and second, the court misapplied the rele-
vant test by dismissing the dispositive factor: economic depend-
ence. After careful review, we find that the Agents were properly
classified as independent contractors. We address each argument
in turn.
A. Non-FLSA Caselaw
“The common law concepts of ‘employee’ and ‘independent
contractor’ [are] specifically rejected as determinants of who is pro-
tected” by the FLSA. Usery, 527 F.2d at 1311 (emphasis added).
The Agents argue that the district court erred by drawing guidance
from common law authority to determine employment status. We
disagree. The district court employed the proper FLSA standard as
the determinant of the Agents’ employment status: economic inde-
pendence. See Yoder, 2022 WL 1055184, at *10 (“This conclusion
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follows careful consideration of the six Scantland factors . . . [b]ut
this was not simply counting factors. I considered each factor in
the context of the overall issue, which is economic dependence.”).
Thus, the cases the district court drew guidance from did not
amount to error because it did not change the scope of the relevant
analysis.
B. Economic Independence
The Agents next argue that the district court applied the in-
correct analyses to determine the outcome of the individual Scant-
land factors. They claim that instead of focusing on whether the
Agents were dependent on Farm Bureau, the court focused on
common law concepts of employment. We disagree.
The court correctly identified the proper rubric for deter-
mining each factor under our caselaw. See Yoder, 2022 WL 1055184,
at *3–9 (citing to Scantland, 721 F.3d 1308, for the proper scope of
each factor and analyzing each under the stated scope).3
i. Control
The Agents contend that Farm Bureau controlled every sig-
nificant aspect of their work. Under the control factor, we consider
3 The Agents encourage us to adopt the standard set out in Garcia-Celestino v.
Ruiz Harvesting, Inc., 898 F.3d 1110 (11th Cir. 2018) (Garcia-Celestino II) and
Garcia-Celestino v. Ruiz Harvesting, Inc., 843 F.3d 1276 (11th Cir. 2016) (Garcia-
Celestino I) for our analysis. But those cases apply the “Aimable factors” test
for joint employment under the FLSA, not the Scantland economic reality
test—relevant here—to determine an alleged employee’s employment status
under the FLSA. Garcia-Celestino I, 843 F.3d at 1294.
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the “nature and degree of the alleged employer’s control as to the
manner in which the work is to be performed. Control is only sig-
nificant when it shows an individual exerts such a control over a
meaningful part of the business that she stands as a separate eco-
nomic entity.” Scantland, 721 F.3d at 1313 (internal quotation
marks omitted). The evidence the Agents point to reflect control
over aspects like what products can be sold and what the commis-
sion rate is, but the evidence does not go towards the manner in
which the work is to be performed. The record reflects that the
Agents are free to control the manner in which they work. Nota-
bly, they pursued their own leads, determined their own methods
for developing sales, and hired and maintained support staff if they
determined a need for assistance. Thus, there was not sufficient
control to label the parties as the same “economic entity.” Usery,
527 F.2d at 1313.
ii. Opportunity for Profit and Loss
The Agents next maintain that the facts the district court re-
lied on for evaluating the Agents’ opportunity for profit and loss—
their discretion to decide which sales methods to prioritize, decide
how best to use their time each day, and opportunity to hire staff,
and advertise—had nothing to do with managerial skill. See Scant-
land, 721 F.3d at 1316 (stating that this factor “considers the alleged
employee’s opportunity for profit or loss depending upon his mana-
gerial skill” (emphasis added)). The facts the district court pointed
to reflect managerial skill and thus were proper determinants of
this factor.
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22-11135 Opinion of the Court 9
iii. Investments
Next, the Agents argue that the district court considered
more than the necessary investments and therefore erroneously
found that this factor pointed towards independent contractor sta-
tus. Instead, the court should have focused exclusively on the in-
vestments that the business required to operate. See id. at 1317 (stat-
ing that the investment factor “considers the alleged employee’s
investment in equipment or materials required for his task, or his
employment of workers”).
In analyzing this factor, Scantland focused on whether the
alleged employee’s ability to hire employees was illusory—an op-
tional investment. Id. at 1316–17. Usery focused on the employees’
risk capital. See Usery, 527 F.2d at 1313–14. Neither of the cases
compared the investment between the alleged employer and em-
ployee. Thus, a reading of our precedent reveals that courts may
analyze investments the alleged employee has the ability to make
and may also consider the alleged employee’s risk capital.
We agree with the Agents that they did not have significant
investments in the materials required for their tasks. Farm Bureau
provided the software necessary to complete and log their duties.
However, the Agents did invest personal capital into advertising
and had the ability to employ support staff without the approval of
Farm Bureau. The latter investment would be wholly the Agents’,
as they would be responsible for paying the salary of those hired
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10 Opinion of the Court 22-11135
staff members. Thus, they had the ability to hire workers, and also
invested significant risk capital for the success of their business.4
iv. Other factors
Finally, we agree with the district court’s well-reasoned anal-
ysis of the remaining factors. We agree with its determination that
licensure implicates special skill of an independent contractor, an
average of 18 years indicates permanence of an employee, and the
Agents’ role is integral to Farm Bureau’s business, again indicating
an employment relationship.
V.
Applying the Scantland factors with an eye towards eco-
nomic independence reveals that the Agents exercised sufficient
control over their business. Accordingly, we AFFIRM the district
court’s order.
AFFIRMED.
4 See Yoder, 2022 WL 1055184, at *7–8 (discussing the various risk capital the
Agents invested into their business).
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