93-006518 City Of Belleair Beach vs. Division Of Retirement Status: Closed Recommended Order on Monday, March 21, 1994.

Summary: City treasurer is employee when council can fire without penalty; independent contractors do not get vacation or sick leave.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CITY OF BELLEAIR BEACH, FLORIDA, )

)

Petitioner, )

)

vs. ) CASE NO. 93-6518

)

DIVISION OF RETIREMENT, )

)

Respondent. )

_________________________________)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly

designated Hearing Officer, William F. Quattlebaum, held a formal hearing in the

above-styled case on February 24, 1994, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Thomas Jask, Esquire

Frazer, Hubbard, Brandt & Trask

595 Main Street

Dunedin, Florida 34698

For Respondent: Jodi B. Jennings, Esquire

Division of Retirement

Cedars Executive Center, Building C

2639 North Monroe Street

Tallahassee, Florida 32399-1560

STATEMENT OF THE ISSUE

Whether City of Belleair Beach Treasurer Robert K. Hebden was an

independent contractor or an employee of the city.

PRELIMINARY STATEMENT

By certified letter dated October 11, 1993, the Division of Retirement

(Division) notified the City of Belleair Beach (City) that the Division regarded

City Treasurer Robert K. Hebden as a part-time employee and that appropriate

contributions to the Florida Retirement System were due.

By Petition for Formal Proceeding, the City challenged the Division's

determination of Mr. Hebden's employment status. The matter was referred to the

Division of Administrative Hearings which scheduled and noticed the hearing.

At hearing, the City presented the testimony of three witnesses and had

exhibits numbered 1-16 admitted into evidence. The Division presented the

testimony of two witnesses and had exhibits numbered 3, 7, 11 and 12 admitted

into evidence.

No transcript of the hearing was filed. Both parties filed proposed

recommended orders. The proposed findings of fact are ruled upon as set forth

in the Appendix which is attached and hereby made a part of this Recommended

Order.

FINDINGS OF FACT

1. The Petitioner City of Belleair Beach (City) is a participating local

agency of the Florida Retirement System (FRS) and is subject to the laws

applicable to the FRS. The City began participating in the FRS through the

adoption of City Ordinance 99 in 1973.

2. The Respondent Division of Retirement (Division) is the state agency

charged by statute with the administration of the FRS.

3. On a date unspecified, the Division's Management Review Section audited

the City as required by statute. Based on the audit, the Division concluded

that Mr. Hebden was not an independent contractor, but was a part time employee

of the City. The Division communicated this information to the City by letter

of May 27, 1992.

4. The Division's Enrollment Section, responsible for enrolling employees

in the FRS, conducted an analysis of the materials obtained by the Management

Review Section, and concurred in the initial employment status determination.

5. By letter of October 11, 1993, the Director of the State Division of

Retirement notified the City that the Division had determined Mr. Hebden to be

have been an employee in a regularly established position for purposes of the

FRS from July 1979 through February 1991, and that FRS contributions were due

for that period.

6. On October 15, 1993, Mr. Hebden signed an FRS application for service

retirement. The application was filed with the FRS.

7. Mr. Hebden completed the application on the suggestion of the

Enrollment Section Administrator. Mr. Hebden considers himself to have worked

for the City as an independent contractor and would not have filed an FRS

application without the request by the enrollment administrator.

8. In concluding that Mr. Hebden was an employee, the Division reviewed

all materials furnished by the City. Such materials included copies of

contracts, billing statements and IRS forms. At all times, the Division has

been amenable to reviewing any additional documents submitted by the City.

9. Beginning in 1972, and continuing to February of 1991, Robert K. Hebden

provided various services to the City. Beginning in July 1979, Mr. Hebden

served as the City Treasurer.

10. The position of Belleair Beach City Treasurer is established by city

ordinance.

11. The position description for the City Treasurer sets forth duties as

follows:

The treasurer works on a daily basis primarily under

the mayor's supervision but is ultimately accountable

to the city council. Compiles operating and capital

expense estimates for annual budget. Forecasts problem

areas of income and expense and proposes possible

solutions. Maintains general accounting system and

appropriate operating cash balances. Submits to

council a monthly detailed statement of revenue and

disbursements in contrast with annual budget. Prepares

for submission to council a detailed financial

statement as of the end of each fiscal year. Invests

surplus General Government Funds in conjunction with

the Mayor or Deputy Mayor and recommends investment of

Sewer Trust Funds in conjunction with the approved

Trustee. Provides for payment of bonds and interest

and maintains files for cancelled coupons and bonds.

Maintains capital assets inventory including

acquisition and disposition.

12. Between July 1, 1979 and February 12, 1991, Mr. Hebden was the

Belleair Beach City Treasurer. He performed the duties of the position

description and such additional duties as were assigned at the discretion of the

Mayor and Council.

13. In February 1983, Mr. Hebden and the City entered into a written

contract regarding his service as Treasurer. The initial contract was

retroactive to October 1, 1982. Prior to this point, Mr. Hebden acted as City

Treasurer under an oral agreement with the City officials.

14. The February 2, 1983 contract identifies Mr. Hebden as "the

Contractor." The contract is for the one year period of October 1, 1982 to

September 30, 1983 and provides as follows:

The Contractor will be allowed twelve (12) days of paid

sick leave and at times mutually agreeable fifteen (15)

days of vacation without adjustment to the monthly fee.

Absence in excess of this amount will be adjusted on a

prorata basis.

The work week will be 8:30 A. M. to 12:30 P. M. daily,

Monday through Friday, except for legal holidays

recognized by the City. In addition, attendance will

be required at Council meetings, work sessions and

committee meetings, as may be determined by the Mayor.

Services will be reimbursed on a monthly basis at the

rate of SEVEN HUNDRED DOLLARS ($700.00) per month, plus

an allowance of SEVENTY DOLLARS ($70.00) for expenses

upon receipt of a statement.

This agreement may be extended beyond the original term

of One (1) year upon such terms and conditions as the

parties shall mutually agree between them.

15. Beginning with the subsequent agreement dated July 14, 1983, all

contracts identify Mr. Hebden as "the City Treasurer" rather than "the

Contractor."

16. The July 14, 1983 contract provides as follows:

That Robert K. Hebden shall serve the City of Belleair

Beach as the City Treasurer, appointed by the City

Council. The services of the City Treasurer shall be

performed between the hours of 8:30 a.m. to 12:30 p.m.

daily, Monday through Friday, except for legal holidays

recognized by the City. In addition, attendance will

be required at Council meetings, work sessions and

committee meetings, as may be determined by the Mayor.

The duties of the City Treasurer shall include but not

be limited to:

-compilation of current and capital expense

estimates for the annual budget

-maintenance of a general accounting system

-submission to the city council of a monthly

detailed statement of revenue and

disbursements in contrast with the annual

budget

-preparation for submission to council of a

detailed financial statement as to the end

of each fiscal year

A RETAINER fee shall be paid by the City of Belleair

Beach to the City Treasurer for the above service which

shall be EIGHT HUNDRED THIRTY DOLLARS AND NO/100

($830.00) per month.

THIS AGREEMENT shall be reviewed annually by the

Personnel Committee of the City Council, the Mayor and

the City Treasurer.

THIS AGREEMENT shall expire on September 30 of each

year unless renewed by Council prior to that time.

THIS AGREEMENT shall be cancelled by either party upon

a thirty (30) day notice of intent to do so.

17. The September 10, 1984 contract for the one year period to September

30, 1985 is identical to the agreement of July 14, 1983 except that the retainer

fee was increased to $900.00 monthly.

18. The July 15, 1985 contract for the one year period to September 30,

1986 is similar to the agreement of September 10, 1984. The retainer fee was

increased to $1100.00 monthly and paid leave was again included. The agreement

provides as follows:

....In addition, the City Treasurer shall receive three

work-weeks vacation annually (allowing for a base

figure of 3 work-weeks for the current fiscal year) and

twelve work-days sick leave annually (allowing for

twelve work-days for the current fiscal year).

THIS AGREEMENT shall be reviewed annually by the

Personnel Committee of the City Council, the Mayor and

the City Treasurer.

THIS AGREEMENT shall commence October 1, 1985, and

shall expire on September 30 of each year unless

renewed by Council prior to that time.

THIS AGREEMENT shall be cancelled by either party upon

a thirty (30) day notice of intent to do so.

19. The September 23, 1986 contract for the one year period to September

30, 1987 is substantially similar to the preceding contract, however, an

amendment was made to the paid leave provisions. The agreement provides as

follows:

That Robert K. Hebden shall serve the City of Belleair

Beach as the City Treasurer, appointed by the City

Council. The services of the City Treasurer shall be

performed between the hours of 8:30 a.m. to 12:30 p.m.

daily, Monday through Friday, except for legal holidays

recognized by the City. In addition, attendance will

be required at Council meetings, work sessions and

committee meetings, as may be determined by the Council

or Mayor. The duties of the City Treasurer shall

include but not be limited to:

- compilation of current and capital expense

estimates for the annual budget

- maintenance of a general accounting system

- submission to the city council of a monthly

detailed statement of revenue and

disbursements in contrast with the annual

budget

- preparation for submission to council of a

detailed financial statement as to the end

of each fiscal year

A RETAINER fee shall be paid by the City of Belleair

Beach to the City Treasurer for the above service which

shall be ELEVEN HUNDRED THIRTY DOLLARS AND NO/100

($1100.00) per month. In addition, the City Treasurer

shall receive three work-weeks vacation annually and

twelve work-days sick leave annually. Annual leave,

which will only be applied against working days, and

shall be taken in not less than four (4) hour

increments, may accrue to a maximum of fifteen (15)

days. Annual leave in excess of fifteen (15) days will

be forfeited on the following anniversary date after

the year in which earned.

20. The August 3, 1987 contract for the one year period of October 1, 1987

to September 30, 1988 is substantially similar to the preceding contract except

that the work hours were amended to 8:00 a.m. to 12:30 p.m. and monthly payment

was increased to $1300.00.

21. The September 12, 1988 contract for the one year period of October 1,

1988 to September 30, 1989 is substantially similar to the preceding contract

except that monthly payment was increased to $1350.00.

22. In 1989, some Council members questioned Mr. Hebden's performance and

considered termination of his contract.

23. The September 25, 1989 contract for the one year period of October 1,

1989 to September 30, 1990 is substantially similar to the preceding contract

except that the agreement provides "for a six months performance evaluation."

Apparently, the concerned Council members were satisfied with the review and the

contract was again renewed.

24. The September 10, 1990 contract reflected Mr. Hebden's intention to

leave his position. The contract provides as follows:

That Robert K. Hebden shall serve the City of Belleair

Beach as the City Treasurer, appointed by the City

Council. The services of the City Treasurer shall be

performed between the hours of 8:00 a.m. to 12:30 p.m.

daily, Monday through Friday, except for legal holidays

recognized by the City. In addition, attendance will

be required at Council meetings, work sessions and

committee meetings, as may be determined by the Council

or Mayor. The duties of the City Treasurer shall

include but not be limited to:

- compilation of current and capital expense

estimates for the annual budget

- maintenance of a general accounting system

- submission to the city council of a monthly

detailed statement of revenue and

disbursements in contrast with the annual

budget

- preparation for submission to council of a

detailed financial statement as to the end

of each fiscal year

* A RETAINER fee shall be paid by the City of Belleair

Beach to the City Treasurer for the above service which

shall be [[THIRTEEN HUNDRED AND FIFTY DOLLARS AND

NO/100 ($1350.00)]]

AND NO/100 ($1450.00)>> per month. In addition, the

City Treasurer shall receive [[three work-weeks

vacation annually and twelve]] > work-days

sick leave [[annually. Annual leave, which

will only be applied against working days,

and shall be taken in not less than four (4) hour

increments, may accrue to a maximum of fifteen (15)

days. Annual leave in excess of fifteen (15) days will

be forfeited on the following anniversary date after

the year in which earned.]]

through September 30, 1990 and not taken will be

paid on completion of this contract.>>

[[THIS AGREEMENT shall provide for a six months

performance evaluation.]]

[[THIS AGREEMENT shall be reviewed annually by the

personnel committee of the City Council, the Mayor and

the City Treasurer.]]

THIS AGREEMENT shall commence October 1, 1985, and

shall expire on > [[September

30 of each year unless renewed by Council prior to

that time.]]

THIS AGREEMENT shall be cancelled by either party upon

a thirty (30) day notice of intent to do so.

* Note: In the above quotation, language which has been added

is within the <>>; deleted language is within the [[]].

25. All the contracts identified herein were between the City and Mr.

Hebden personally. Mr. Hebden signed the contracts. Except as otherwise stated

herein, the terms of the contracts were negotiated between Mr. Hebden and the

City.

26. Mr. Hebden performed all the responsibilities of the contract

personally. For a brief period, he was assisted by a man identified as "Mr.

Denman," a person employed by the City. He hired no assistants.

27. Mr. Hebden performed his responsibilities according to practices and

procedures he created. He was not provided instructions by the City on how to

perform his tasks. The City provided no training to Mr. Hebden.

28. Prior to terminating his tenure as City Treasurer, Mr. Hebden trained

his successor in the practices and procedures Mr. Hebden had developed.

29. At all times during Mr. Hebden's employment with the City, he worked

the hours specified by the contracts in his office at City Hall. Mr. Hebden

testified that he could not recall how his office hours had been determined.

30. The space was provided by the City. The responsibilities of Mr.

Hebden's position required utilization of city records, and it was therefore

appropriate for such tasks to be performed in an office at City Hall. All

furnishings for the office and materials used in performing his tasks were

provided by the City.

31. During the period between July 1979 and February 1991, Mr. Hebden

submitted to the City statements for payment. Generally, the statements were

submitted on a monthly basis.

32. Mr. Hebden had no risk of profit or loss based on any actions of the

City. He had no personal investment in the City. Mr. Hebden was paid according

to the terms of the contract. He did not receive additional remuneration for

his appearance at or participation in Council meetings, work sessions or

committee meetings as directed by the Council or Mayor.

33. In the first written contract, Mr. Hebden received a payment for

"expenses" in addition to the monthly remuneration. Additionally, Mr. Hebden

was reimbursed for personal expenses related to City business use of his car and

his boat.

34. Although only one formal performance evaluation was completed during

his service, the contracts provide for annual review, except for the final

contract which terminated Mr. Hebden's service to the City. Upon said

termination, Mr. Hebden was paid for the accrued annual leave.

35. Under the terms of the contract, Mr. Hebden's services could be

terminated without penalty upon thirty days notice by either party.

36. Mr. Hebden did not advertise his services to the general public,

because he was not interested in taking on additional work, however, for a time,

he provided accounting consulting services to the Indian Rocks Fire Control

District and was compensated for his work. He also provided volunteer services

to the Church of the Isles.

37. During the period relevant to this proceeding Mr. Hebden held no

business or occupational licenses.

38. For the years 1979 through 1982, the City reported Mr. Hebden's

compensation to the Internal Revenue Service Form by using IRS Form 1099-NEC,

the form used to report "Nonemployee Compensation."

39. For the years 1983 through 1991, the City reported Mr. Hebden's

compensation to the Internal Revenue Service Form by using IRS Form 1099-MISC,

the form used to report "Miscellaneous Compensation."

40. The City did not provide health or life insurance coverage to Mr.

Hebden.

41. The City did not pay federal social security or withholding taxes for

Mr. Hebden.

42. The City did not provide or pay workers compensation benefits or

unemployment benefits for Mr. Hebden.

43. The City did not pay retirement contributions to the FRS for Mr.

Hebden.

CONCLUSIONS OF LAW

44. The Division of Administrative Hearings has jurisdiction over the

parties to and subject matter of this proceeding. Section 120.57(1), Florida

Statutes.

45. The Division of Retirement is authorized to administer the provisions

of the Florida Retirement System. Section 121.031(1), Florida Administrative

Code.

46. Membership in the FRS is compulsory for all employees filling full-

time or part-time regularly established positions. Rule 60S-1.004(4), Florida

Administrative Code.

47. For purposes of the FRS, an "officer or employee" is defined as any

person receiving salary payments for work performed in a regularly established

position and , if employed by a city or special district, employed in a covered

group. Section 121.021(11), Florida Statutes.

48. A regularly established position is defined as an employment position

which will be in existence for a period beyond six consecutive months. Rule

60S-1.004(4)(b), Florida Administrative Code.

49. In considering whether a person is an employee or an independent

contractor, the Division Rule 22B-6.01(12), Florida Administrative Code,

provides the following definition:

CONSULTANT OR OTHER PROFESSIONAL PERSON--

Means an individual who: agrees to provide certain

services; works according to his own methods; is not

subject to the control of his employer, except as to

the results of his work; and does not enjoy the fringe

benefits offered by the employer. A consultant or

other professional person usually: is compensated from

an other salaries and wages account; does not earn

annual or sick leave; and may frequently do a majority

of his work in his own office rather than on the

employer's premises.

50. In interpreting its rule, the division relies on common law tests of

independent contractor status, and specifically the tests formulated by 1

Restatement of the Law, Agency (2nd ed.) Section 220, as described in Cantor v.

Cochran, 184 So.2d 173 (Fla. 1966). Davis v. Department of Administration,

Division of Retirement, 585 So.2d 421 (Fla. 1st DCA 1991). As set forth in

Cantor, these tests are as follows:

(a) the extent of control which, by the agreement, the

master may exercise over the details of the work;

(b) whether or not the one employed is engaged in a

distinct occupation or business;

(c) the kind of occupation, with reference to whether,

in the locality, the work is usually done under the

direction of the employer or by a specialist without

supervision;

(d) the skill required in the particular occupation;

(e) whether the employer or the workman supplies the

instrumentalities, tools, and the place of work for the

person doing the work;

(f) the length of time for which the person is employed;

(g) the method of payment, whether by the time or by

the job;

(h) whether or not the work is a part of the regular

business of the employer;

(i) whether or not the parties believe they are

creating the relationship of master and servant; and

(j) whether the principal is or is not in business.

51. A review of the criteria as applied to this case is as follows:

THE EXTENT OF CONTROL WHICH, BY THE AGREEMENT, THE

MASTER MAY EXERCISE OVER THE DETAILS OF THE WORK--

52. The description of the duties of the Belleair Beach City Treasurer

describe in detail exactly what is expected of the position. The City Treasurer

is to compile operating and capital expense estimates for annual budgets,

forecast problem areas of income and expense and propose possible solutions,

maintain a general accounting system and appropriate operating cash balances,

submit a monthly detailed statement of revenue and disbursements in contrast

with annual budget, submit a detailed financial statement as of the end of each

fiscal year, invest in conjunction with the Mayor or Deputy Mayor surplus

General Government Funds, recommend in conjunction with the approved trustee

investment of Sewer Trust Funds, provide for payment of bonds and interest,

maintain files for cancelled coupons and bonds, and maintain an inventory of

capital assets including acquisition and disposition. Mr. Hebden was required

to attend various meetings as directed by the Mayor and Council, and to perform

other tasks as directed.

53. Most importantly, the treasurer works on a daily basis under the

mayor's supervision and is ultimately accountable to the city council.

According to each of Mr. Hebden's contracts, the City Treasurer can be fired

with 30 days notice without penalty. As set forth in Cantor, citing Larson on

Workmen's Compensation Law:

The power to fire is the power to control. The

absolute right to terminate the relationship without

liability is not consistent with the concept of

independent contractor, under which the contractor

should have the legal right to complete the project

contracted for and to treat any attempt to prevent

completion as a breach of contract.

54. The detailed description of duties and the termination provision in

each of Mr. Hebden's contracts are contrary to the assertion of independent

contractor status.

WHETHER OR NOT THE ONE EMPLOYED IS ENGAGED IN A

DISTINCT OCCUPATION OR BUSINESS--

55. Mr. Hebden was not engaged in a distinct occupation or business while

serving as City Treasurer. He met the employment qualifications set forth on

the job description and was employed to perform the duties identified by the

City. As City Treasurer, he was engaged, as were other City employees, in

conducting the business of the City.

THE KIND OF OCCUPATION, WITH REFERENCE TO WHETHER, IN

THE LOCALITY, THE WORK IS USUALLY DONE UNDER THE

DIRECTION OF THE EMPLOYER OR BY A SPECIALIST WITHOUT

SUPERVISION--

56. The occupation of City Treasurer is, by job description, done under

the immediate supervision of the Mayor and ultimately the City Council. The

successor to Mr. Hebden was designated as an employee of the City. There is no

credible evidence that Mr. Hebden was permitted to perform the responsibilities

of City Treasurer without supervision.

THE SKILL REQUIRED IN THE PARTICULAR OCCUPATION--

57. Mr. Hebden met the employment qualifications set forth on the job

description and was employed to perform the duties identified by the City. As

with many occupations, any person meeting the qualifications could have also

performed the job.

WHETHER THE EMPLOYER OR THE WORKMAN SUPPLIES THE

INSTRUMENTALITIES, TOOLS, AND THE PLACE OF WORK FOR THE

PERSON DOING THE WORK--

58. Because Mr. Hebden required access to City records to perform his job

tasks, it is logical that he would maintain an office at City Hall. However,

the City provided all furnishings in the office and provided all supplies to Mr.

Hebden. Mr. Hebden did not control the hours of his work which were dictated by

the employment contract.

THE LENGTH OF TIME FOR WHICH THE PERSON IS EMPLOYED--

59. Mr. Hebden was continuously employed as City Treasurer for about 12

years with no break in service.

THE METHOD OF PAYMENT, WHETHER BY THE TIME OR BY THE

JOB--

60. Mr. Hebden's contracts provide no payment for completion of specific

tasks, but instead provide payment for a monthly period. The time expended in

attending meetings outside the specified work hours was not additionally

compensated, but by the terms of the contracts were included in the monthly pay.

WHETHER OR NOT THE WORK IS A PART OF THE REGULAR

BUSINESS OF THE EMPLOYER--

61. The City Treasurer's position is part of the regular operation of the

City. The position is established by ordinance and is subject of a position

description in the city's records.

WHETHER OR NOT THE PARTIES BELIEVE THEY ARE CREATING

THE RELATIONSHIP OF MASTER AND SERVANT--

62. It is clear that the parties in this case were not attempting to

create a master-servant relationship. The City paid none of the benefits which

could suggest the existence of an employer-employee situation. Nonetheless,

consideration of the nature of Mr. Hebden's employment as discussed herein,

including the City's control over the Treasurer's responsibilities, working

conditions, and tenure of employment, indicates that his position was one of an

employee of the City.

WHETHER THE PRINCIPAL IS OR IS NOT IN BUSINESS--

63. Mr. Hebden worked under his own name, had no established business

entity, did not advertise his services, made no sustained attempt to seek

additional contracts for his services and held no business or occupational

licenses.

64. Based on a review of the applicable rules in this case, the greater

weight of the evidence establishes that Mr. Hebden was not an independent

contractor but was a employee part time in a regularly established position with

the City of Belleair Beach.

65. In 1991, the Division adopted Rule 60S-6.001(33) Florida

Administrative Code, incorporating the Cantor criteria and providing additional

standards for determination of independent contractor status. Although the rule

was not in effect during Mr. Hebden's tenure as City Treasurer, the rule was in

effect at the time the Division rendered its determination as to Mr. Hebden and

was applied by the Division.

66. Application of the factors within Rule 60S-6.001(33) Florida

Administrative Code, to this case provides as follows:

(33) INDEPENDENT CONTRACTOR--

Means an individual who is not subject to the control

and direction of the employer for whom work is being

performed, with respect not only to what shall be done

but to how it shall be done. If the employer has the

right to exert such control, an employer-employee

relationship exists and the person is an employee and

not an independent contractor. The Division has

adopted the following factors as guidelines to aid in

determining whether an individual is an employee or an

independent contractor. The weight given each factor

is not always the same and varies depending on the

particular situation.

(a) INSTRUCTIONS: An employee must comply with

instructions from his employer about when, where, and

how to work. The instructions may be oral or may be in

the form of manuals or written procedures which show

how the desired result is to be accomplished. Even if

no actual instructions are given, the control factor is

present if the employer has the right to give

instructions.

67. The contract between the City and Mr. Hebden directed the time and

place of his employment. The City retained control over the duties of the City

Treasurer. Nothing in the contract precluded the City from directing how the

tasks were to be performed.

(b) TRAINING: An employee is trained to perform

services in a particular manner. This is relevant when

the skills and experience which would be used as an

independent contractor were gained as a result of

previous employment. Independent contractors

ordinarily use their own methods and receive no

training from purchasers of their services.

68. Mr. Hebden met the job qualifications set forth in the position

description. He received no training from the City.

(c) INTEGRATION: An employee's services are

integrated into the business operations because the

services are critical and essential to the success or

continuation of an agency's progress/operation. This

shows that the employee is subject to direction and

control.

69. The City Treasurer's position is part of the regular operation of the

City. The position is established by ordinance and is subject of a position

description in the city's records. The position of Treasurer is critical and

essential to the continuation of the City's operation.

(d) SERVICES RENDERED PERSONALLY: An employee renders

services personally. This shows that the employer is

interested in the methods as well as the results. Lack

of employer control may be indicated when a person has

the right to hire a substitute without the employer's

knowledge or approval.

70. Mr. Hebden rendered his services personally. The contracts between

the City and Mr. Hebden provided him no right to hire a substitute. His

employment as City Treasurer was premised on his individual qualifications.

(e) HIRING ASSISTANTS: An employee works for an

employer who hires, supervises, and pays assistants.

An independent contractor hires, supervises, and pays

assistants under a contract that requires him or her to

provide materials and labor and to be responsible only

for the result.

71. The sole assistant to Mr. Hebden during his tenure as City Treasurer

was another City employee.

(f) CONTINUING RELATIONSHIP: An employee has a

continuing relationship with an employer. A continuing

relationship may exist where work is performed at

frequently recurring, although irregular intervals.

72. Mr. Hebden was continuously employed as City Treasurer for about 12

years with no break in service.

(g) SET HOURS OF WORK: An employee has a continuing

relationship with an employer. An independent

contractor is the master of his or her own time and

works on his own schedule.

73. Mr. Hebden's work scheduled was set by contract. He was not

contractually permitted to come and go from work at his convenience. His

vacation time and sick leave were dictated by the contract, even to the point of

the contract provision requiring annual leave be taken in increments of not less

than four hours.

(h) FULL-TIME OR PART-TIME WORK: An employee may work

wither full-time or part-time for an employer. Full

time does not necessarily mean an 8-hour day or a 5 or

6-day week. Its meanings may vary with the intent of

the parties, the nature of the occupation and customs

in the locality. These conditions should be considered

in defining "full-time." An independent contractor can

work when and for whom he or she chooses.

74. Mr. Hebden could not work "when and for whom" he chose. He was

required to perform his City Treasurer role according to the schedule set forth

in the contract.

(i) WORK DONE ON PREMISES: An employee works on the

premises of an employer, or works on a route or at a

,.location designated by an employer. The performance

of work on the employer's premises is not controlling

in itself; however it does imply that the employer has

control over the employee. Work performed off the

employer's premises does indicate some freedom from

control; however, it does not in itself mean the worker

is not an employee.

75. Although simple application of this criteria would lead to the

conclusion that Mr. Hebden was an employee of the City, the City Treasurer

position requires access to City records to perform his job tasks, therefore it

is reasonable to maintain an office at City Hall.

(j) ORDER OR SEQUENCE OF SERVICES: An employee

generally performs services in the order or sequence

set by an employer. This shows that the employee is

subject to direction and control of the employer.

76. The order of services provided is set forth in the employment contract

which specifies the timing of the Treasurer's reporting responsibilities.

(k) REPORTS: An employee submits oral or written

reports to an employer. This shows that the employee

must account to the employer for his or her actions.

77. Mr. Hebden's employment contract identifies the reports which must be

provided by him to the Mayor and Council.

(l) PAYMENTS: An employee is usually paid by the

hour, week or month. An independent contractor is paid

periodically (usually a percent of the total payment)

by the job or on a straight commission.

78. Mr. Hebden was paid on a monthly basis.

(m) EXPENSES: An employee's business and/or travel

expenses are paid by an employer. This shows that the

employer is in a position to control expenses and

therefore the employee is subject to regulations and

control.

79. In the initial written contract, Mr. Hebden received a fixed

reimbursement for "expenses" in addition to the monthly payment. He was also

reimbursed for personal expenses related to City business use of his car and his

boat.

(n) TOOLS AND MATERIALS: An employee is furnished

significant tools, materials, and other equipment by an

employer. An independent contractor usually provides

his own tools, materials, etc.

80. The City provided all furnishings in Mr. Hebden's office and provided

all his work supplies.

(o) INVESTMENT: An employee is usually furnished the

necessary facilities. An independent contractor has a

significant investment in the facilities he or she uses

in performing services for someone else.

81. Mr. Hebden had no investment in the City's facilities.

(p) PROFIT OR LOSS: An employee performs the services

for an agreed upon wage and is not in a position to

realize a profit or suffer a loss as a result of his

services. An independent contractor can make a profit

or suffer loss. Profit or loss implies the use of

capital by the individual in an independent business of

his own.

82. Mr. Hebden performed his job for an agreed upon payment. He was not

in a position to realize a profit or suffer a loss as a result of his services.

He had no capital investment in any independent business of his own.

(q) WORKS FOR MORE THAN ONE PERSON OR FIRM: An

employee usually works for one organization. However,

a person may work for a number of people or

organizations and still be an employee of one or all of

them. An independent contractor provides his or her

services to two or more unrelated persons or firms at

the same time.

83. Mr. Hebden provided accounting consulting services to the Indian Rocks

Fire Control District and was compensated for his work. He provided volunteer

services to the Church of the Isles.

(r) OFFERS SERVICES TO GENERAL PUBLIC: An independent

contractor makes his or her services available to the

general; public. This can be done in a number of ways:

Having his/her own office and assistants, hanging out a

"shingle," Holding business licenses, having listings

in business directories and telephone directories, and

advertising in newspapers, trade journals, etc.

84. Mr. Hebden did not advertise his services to the general public. He

held no business or occupational licenses.

(s) RIGHT TO TERMINATE EMPLOYMENT: An employee can be

fired by an employer. An independent contractor cannot

be fired so long as he or she produces a result that

meets the specifications of the contract. An

independent contractor can be terminated but usually he

will be entitled to damages for expenses incurred, lost

profit, etc.

85. Under the terms of the contract, Mr. Hebden's employment could be

terminated without penalty upon thirty days notice by the City.

(t) RIGHT TO QUIT: An employee can quit his or her

job at any time without incurring liability. An

independent contractor usually agrees to complete a

specific job and is responsible for its satisfactory

completion, or is legally obligated to make good for

failure to complete it.

86. Under the terms of the contract, Mr. Hebden could quit his job as City

Treasurer without penalty upon thirty days notice to the City.

87. Application of Rule 60S-6.001(33), Florida Administrative Code to the

facts in this case further establishes that Mr. Hebden was not an independent

contractor but was a employee part time in a regularly established position with

the City of Belleair Beach.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is

hereby

RECOMMENDED that the Department of Management Services, Division of

Retirement, enter a Final Order determining that as City Treasurer of the City

of Belleair Beach from July 1979 through February 1991, Robert K. Hebden was an

employee of the City, and as such was a compulsory member of the Florida

Retirement System for which contributions from the City are due.

DONE and RECOMMENDED this 21st day of March, 1994, in Tallahassee, Florida.

__________________________________

WILLIAM F. QUATTLEBAUM

Hearing Officer

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

[phone]

Filed with the Clerk of the

Division of Administrative Hearings

this 21st day of March, 1994.

APPENDIX TO CASE NO. 93-6518

The following constitute rulings on proposed findings of facts submitted by

the parties.

Petitioner

The Petitioner's proposed findings of fact are accepted as modified and

incorporated in the Recommended Order except as follows:

3. Rejected, contrary to the greater weight of the evidence. Mr. Hebden

submitted invoices for payment as early as July, 1979.

11. Rejected, not supported by greater weight of the evidence. Because

Mr. Hebden developed his own procedures for performing the duties of the City

Treasurer, and trained his successor in performing the tasks of City Treasurer,

it is not possible to conclude that Mr. Hebden's services were "not essential to

the success or continuation of the City's operation."

14. Rejected, irrelevant.

15. Rejected, contrary to greater weight of evidence. Mr. Hebden

testified on direct examination that he could not recall who chose the work

hours set forth by contract. All contracts specify the hours to be worked. As

to leave time, the first contract provided that such leave could be used only

"at times mutually agreeable...." Subsequent contracts required annual leave to

be used in four hour increments.

19. Rejected, contrary to greater weight of evidence. Mr. Hebden

testified that some auto and boat expenses had been reimbursed. First contract

and invoices for payment through September 30, 1982 include payment of sums for

"expenses."

20. Rejected, contrary to greater weight of evidence. The contracts

specify standard hours of employment and require attendance at meetings as

directed by the Mayor and Council. The Respondent's assertion that Mr. Hebden

"could make a profit or suffer a loss" is unsupported by credible evidence.

Respondent

The Respondent's proposed findings of fact are accepted as modified and

incorporated in the Recommended Order except as follows:

5. Rejected, as to employment status of Mr. Hebden's predecessor or

successor as City Treasurer, irrelevant.

28, 30. Rejected, as to employment status of Mr. Hebden's successor as

City Treasurer, irrelevant.

COPIES FURNISHED:

A. J. McMullian, III, Director

Division of Retirement

Cedars Executive Center, Bldg. C

2639 N. Monroe St.

Tallahassee, Florida 32399-1560

William H. Lindner, Secretary

Knight Building, Suite 307

Koger Executive Center

2737 Centerview Drive

Tallahassee, Florida 32399-0950

Paul A. Rowell, General Counsel

Knight Building, Suite 312

Koger Executive Center

2737 Centerview Drive

Tallahassee, FL 32399-0950

Thomas J Trask, Esquire

Frazer, Hubbard, Brandt & Trask

595 Main Street

Dunedin, Florida 34698

Jodi B. Jennings, Esquire

Division of Retirement

Cedars Executive Center, Building C

2639 North Monroe Street

Tallahassee, Florida 32399-1560

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended

Order. All agencies allow each party at least ten days in which to submit

written exceptions. Some agencies allow a larger period within which to submit

written exceptions. You should contact the agency that will issue the final

order in this case concerning agency rules on the deadline for filing exceptions

to this Recommended Order. Any exceptions to this Recommended Order should be

filed with the agency that will issue the final order in this case.