17-005068 Mark Smithers vs. Xencom Facility Management, Llc Status: Closed Recommended Order on Tuesday, May 15, 2018.

Summary: Xencom discharged because the contract they were employed to work on was terminated. Petitioners were not discharged because of their sex or in retaliation for complaining about sexual harassment in the workplace.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BERNARD BROOKS,

MICHAEL HARRISON, MARK SMITHERS,

CODY LUCAS, DAVID OKKER,

MARVIN L. RAGLAND,

JACOB P. MILLER, Case Nos. 17 - 5010

KYLIE SMITHERS, AND FAITH 17 - 5066

TAPPAN, 17 - 5068

17 - 5070

Petitioners, 17 - 5072

17 - 5074

vs. 17 - 5076

17 - 5078

XENCOM FACILITY MANAGEMENT, LLC, 17 - 5080

Respondent.

_______________________________/

RECOMMENDED ORDER

Adminis trative Law Judge John D. C. Newton, II , of the

Division of Administrative Hearings (Division) conducted the

final hearing in this matter on December 1, 2017, in Gainesville,

Florida.

APPEARANCES

For Petitioner s : Robert W. Bauer, Esquire

Law Office of Robert W. Bauer P.A.

Suite 1B

2610 Northwest 43rd Street

Gainesville, Florida 32606

For Respondent: Robert E. Luxen, Esquire

Hallet & Perrin

Suite 2400

1445 Ross Avenue

Dallas, Texas 75202

STATEMENT OF THE ISSUE

Whether Respondent, Xencom Facility Management, LLC

(Xencom) , terminated the employment of Petitioners solely because

the contract under which they were working ended.

PRELIMINARY STATEMENT

Michael Harrison, Mark Smithers, Cody Lucas, David Okker,

Marvin L. Ragland, Jacob P. Miller, Kylie Smithers, Faith Tappan,

and Bernard Brooks filed charges of discrimination with the

Florida Commission on Human Relati ons (Commission) against

The MG Herring Group, Inc. (MG Herring) , and Xencom Facility

Management, LLC, under the Florida Civil Rights Act of 1992,

chapter 760, Florida Statutes (2016). 1/ Mark Smithers alleged

that MG Herring discriminated against him in employment on

account of his sex by harassing him and retaliated against him

for complaining. Michael Harrison alleged that MG Herring

discriminated against him in employment on account of his sex by

harassing him and retaliated against him for complainin g. The

other seven Petitioners alleged that MG Herring retaliated

against them because they had opposed a practice that was

unlawful under section 760.10. All Petitioners asserted that MG

Herring was their employer by virtue of a joint employer

relations hip with Xencom.

The same nine Petitioners filed charges of discrimination by

discharge from employment against Xencom under the Florida Civil

Rights Act of 1992 with the Commission. Mr. Harrison claimed

Xencom discriminated against him on account of his sex and

retaliated against him for complaining. Mr. Smithers claimed

that Xencom discriminated against him on account of his sex and

retaliated against him for complaining. All Petitioners claimed

that Xencom retaliated against them for opposing an unlaw ful

employment practice.

In each case, the Commission issued a ÐDetermination: No

Reasonable Cause.Ñ The Commission concluded that MG Herring did

not employ Petitioners. The Commission also concluded that

Xencom terminated PetitionersÓ employment becaus e it lost the

contract under which Petitioners were working, not for the

reasons charged. All nine Petitioners filed a Petition for

Relief challenging the CommissionÓs determination. The

Commission transmitted the cases to the Division to conduct a

final hearing and issue a recommended order.

The claims against Xencom were consolidated under DOAH Case

No. 17 - 5010. The claims against MG Herring were consolidated

under DOAH Case No. 17 - 5067. For purposes of discovery and final

hearing, the consolidated cases traveled together. The

undersigned bifurcated the issues of the cases. Whether MG

Herring was PetitionersÓ employer and whether Xencom unlawfully

terminated PetitionersÓ employment were separated from the issues

of whether MG Herring and Xencom com mitted the unlawful actions

alleged. The issues of whether MG Herring was PetitionersÓ

employer and why Xencom discharged Petitioners were heard first.

All evidence admitted at the final hearing was accepted and

considered in each case.

At the final hear ing, Petitioners presented testimony from

Norine Bowen, Michael Harrison, Kylie Smithers, and Tina Wilson.

PetitionersÓ Exhibits 3 and 17 were admitted into evidence.

MG Herring presented the testimony of Norine Bowen and Tina

Wilson. MG Herring Exhibi ts 1 through 3, 8, 9 through 17, 41,

59, 61, and 63 were admitted. Xencom presented testimony from

Michael Ponds. Xencom Exhibits 1 through 32 were admitted.

After the hearing, the parties ordered a transcript of the

proceedings. It was filed January 10 , 2018. The parties timely

filed proposed recommended orders. They have been considered in

the preparation of this Recommended Order.

FINDING S OF FACT

1. Xencom provides general maintenance, landscaping,

housekeeping, and office cleaning services to ret ail facilities.

In September of 2015, Xencom entered three contracts for services

with CREFII Market Street Holdings, LLC (CREFII). The contracts

were to provide maintenance, landscaping, and office cleaning

services for a mall known as Market Street @ H eathbrook (Market

Street) in Ocala, Florida.

2. Michael Ponds, XencomÓs president, executed the

contracts on behalf of Xencom. Two individuals executed the

contracts on behalf of CREFII. One was Gar Herring, identified

as m anager for Herring Ocala, LL C. The other was Ber nard E.

McAuley, identified as m anager of Tricom Market Street at

Heathbrook, LLC. MG Herring was not a party or signatory to the

contracts. MG Herring does not own or operate Market Street.

A separate entity, The MG Herring Proper ty Group, LLC (Property

Group) , operated Market Street.

3. The contracts, in terms stated in an exhibit to them,

established a fixed price for the yearÓs work, stated the scope

of services, and detailed payment terms. They also identified

labor and labor - related costs in detail that included identifying

the Xencom employees involved, their compensation, and their

weekly number of hours. The contract exhibits also identified

operating costs, including equipment amortization, equipment

repairs, fuel expens es, vacation costs, health insurance, and

storage costs. The contracts ended December 31, 2016.

4. The contracts specify that Xencom is an independent

contractor. Each states: ÐContractor is an independent

contractor and not an employee or agent of the owner.

Accordingly, neither Contractor nor any of ContractorÓs

Representatives shall hold themselves out as, or claim to be

acting in the capacity of, an agent or employee of Owner.Ñ

5. The contracts also specify that the property manager may

terminate the contract at any time without reason for its

convenience. The contracts permit Xencom to engage

subcontractors with advance approval of the property manager.

They broadly describe the services that Xencom is to provide.

Xencom has over 80 such contra cts with different facilities.

6. As the contracts contemplate, only Xencom exerted direct

control of the Petitioners working at Market Street. Property

Group could identify tasks and repairs to be done. Xencom

decided who would do them and how.

7. I n 2013, Xencom hired Michael Harrison to work as its

Operations Manager at Market Street. He was charged with

providing services for which Property Group contracted. His

immediate supervisor was XencomÓs Regional Manager. In 2016,

that was David Snell. Mr. Snell was not located at Market

Street. Property Group also did not have a representative on

site. Before Xencom hired him, Mr. Harrison worked at Market

Street for Property Group.

8. Xencom hired the remaining Petitioners to work at Market

Street under Mr. HarrisonÓs supervision. Each of the Petitioners

completed an Application for Employment with Xencom. The

application included a statement, initialed by each Petitioner,

stating, ÐFurther, I understand and agree that my employment is

for no def inite period and I may be terminated at any time

without previous notice.Ñ All of the Petitioners also received

XencomÓs employee handbook.

9. As XencomÓs Operations Manager and supervisor of the

other Petitioners, Mr. Harrison was responsible for day - to - day

management of Petitioners. He scheduled their work tasks,

controlled shifts, established work hours, and assigned tasks.

10. Mr. Harrison also decided when Petitioners took

vacations and time off. His supervisor expected him to consult

with Propert y Group to ensure it knew what support would be

available and that he knew of any upcoming events or other

considerations that should be taken into account in his

decisions. As Operations Manager, Mr. Harrison was also

responsible for facilitating payroll , procuring supplies, and

managing XencomÓs equipment at the site.

11. Xencom provided Petitioners work uniforms that bore

XencomÓs name. Xencom required Petitioners to wear the uniforms

at work. Xencom provided the supplies and equipment that

Petitio ners used at work.

12. Only Xencom had authority to hire or fire the employees

providing services to fulfill its contracts with the property

manager. Only Xencom had authority to modify PetitionersÓ

conditions of employment. Neither MG Herring, Property Group,

nor Xencom held out Petitioners as employees of MG Herring or

Property Group.

13. There is no evidence that MG Herring or Property Group

employed 15 or more people.

14. Property Group hired Tina Wilson as Market StreetÓs on -

site General Manager on February 1, 2016. Until then there was

no Property Group representative at the site. The absence of a

Property Group representative on - site left Mr. Harrison with

little oversight or accountability under the Xencom contracts for

Market Street. His pr imary Property Group contact was General

Manager Norine Bowen, who was not located at the property.

15. Ms. WilsonÓs duties included community relations,

public relations, marketing, leasing, litigation, tenant

coordination, lease management, constructio n management, and

contract management. She managed approximately 40 contracts at

Market Street, including XencomÓs three service agreements.

Ms. Wilson was responsible for making sure the contracts were

properly executed. Managing the Xencom contracts consumed less

than 50 percent of Ms. WilsonÓs time.

16. During the last weeks of 2016, Mr. Harrison intended to

reduce the hours of Kylie Smithers. Ms. Wilson requested that,

since Ms. Smithers was to be paid under the contract for full -

time work, Ms. S mithers assist her with office work such as

filing and making calls. Mr. Harrison agreed and scheduled

Ms. Smithers to do the work. This arrangement was limited and

temporary. It does not indicate Property Group control over

Xencom employees.

17. Ms. Wilson was XencomÓs point of contact with Property

Group. She and Mr. Harrison had to interact frequently.

Ms. Wilson had limited contact with the other Xencom employees at

Market Street.

18. Friction and disagreements arose quickly between

Mr. Harris on and Ms. Wilson. They may have been caused by having

a property manager representative on - site after Mr. HarrisonÓs

years as either the manager representative himself or as Xencom

supervisor without a property manager on - site. They may have

been caused by personality differences between the two. They may

have been caused by the alleged sexual and crude comments that

underlie the claims of discrimination in employment. They may

have been caused by a combination of the three factors.

19. On November 21 , 2016, Norine Bowen received an email

from the address [e-mail] with the subject of

ÐOpen your eyes about Market Street.Ñ It advised that some

employees worked at night for an event. It said that Ms. Wilson

gave the Xencom employees alco hol to drink while they were still

on the clock. The email said that there was a fight among Xencom

employees. The email also said that at another event at a

restaurant where Xencom employees were drinking, Ms. Wilson gave

Ms. Smithers margaritas to drin k and that Ms. Smithers was

underage.

20. The email claimed that during a tree - lighting event

Ms. Wilson started drinking around 3:30 p.m. It also stated that

Ms. Wilson offered a Xencom employee a drink. The email went on

to say that children from a n elementary school and their parents

were present and that Ms. Wilson was Ðthree sheets to the wind.Ñ

The email concludes stating that Ms. Wilson had been the subject

of three employee lawsuits.

21. On December 14, 2016, Ms. Wilson, Ms. Bowen, and

Mr. Snell met at Property GroupÓs office in Market Street for

their regular monthly meeting to discuss operations at Market

Street. Their discussion covered a number of management issues

including a Xencom employeeÓs failure to show up before 8:00 to

clean as arranged, security cameras, tenants who had not paid

rent, lease questions, HVAC questions, and rats on the roof.

They also discussed the emailÓs allegations. The participants

also discussed a number of dissatisfactions with Mr. HarrisonÓs

performance.

22. Near the end of a discussion about the anonymous email,

this exchange occurred: 2/

Bowen: Okay, so I know that David [Snell], I

think his next step is to conduct his own

investigation with his [Xencom] people, and

HR is still following up with John Ga rrett,

and youÓre meeting with Danny [intended new

Xencom manager for Market Street] tonight?

David Snell: Yes.

Bowen: To finish up paperwork, and, based on

his investigation, it will be up to Xencom to

figure out what to do with people that are

drinki ng on property, off the clock or on the

clock, you know, whatever, what their policy

is.

* * *

Bowen: So, I donÓt know what to make of it.

IÓm just here to do an investigation like IÓm

supposed to do and David is here to pick up

the pieces and meet with his folks one - on -

one, and weÓll see where this takes us.

23. This exchange and the remainder of the recording do not

support a finding that Property Group controlled XencomÓs actions

or attempted to control them. The participants were responsibly

discu ssing a serious complaint they had received, their plan to

investigate it, and pre - existing issues with Mr. Harrison. The

exchange also makes clear that all agreed the issues involving

Xencom employees were for Xencom to address, and the issues

involving Property Group employees were for Property Group to

address.

24. At the time of the December 14, 2016, meeting, the

participants were not aware of any complaints from Mr. Harrison

or Mr. Smithers of sexual harassment or discrimination by

Ms. Wilson.

25. On December 15, 2016, Gar Herring and Norine Bowen

received an email from Mr. Harrison with an attached letter to

XencomÓs Human Resources Manager and others. Affidavits from

Petitioners asserting various statements and questions by

Ms. Wilson about Mr. HarrisonÓs and Mr. SmithersÓ sex life and

menÓs genitalia and statements about her sex life and the

genitalia of men involved were attached. Xencom President

Michael Ponds received a similar email with attachments on the

same day. On December 21, 2016, Mr. Ponds received a letter from

Herring Ocala, LLC, and Tricom Market Street at Heathbrook, LLC,

terminating the service agreements. Their agreements with Xencom

were going to expire December 31, 2016. They had been

negotiating successor agreements. Ho wever, they had not executed

any.

26. Xencom terminated PetitionersÓ employment on

December 21, 2016. Xencom no longer needed PetitionersÓ services

once MG Herring terminated the contract with Xencom. This was

the sole reason it terminated Petitioners.

CONCLUSIONS OF LAW

27 . The Division of Administrative Hearings has

jurisdiction over the subject matter of this proceeding and of

the parties. §§ 120.569 and 120.57(1), Fla. Stat. (201 7 ).

28. Petitioners seek relief from an unlawful employment

practice under section 760.10(1) and (7). These sections

prohibit an employer from discriminating against an employee on

account of sex and retaliating for an employee opposing an

unlawful employment practice.

29. Mr. Harrison and Mr. Smithers argue that Xencom

terminated their employment because of their sex, pointing to the

allegations about Ms. WilsonÓs alleged comments and questions.

All Petitioners allege that Xencom terminated them in retaliation

for their complaints about Ms. WilsonÓs alleged comments an d

questions.

30. Petitioners must prove t he i r claim s of discrimination

and retaliation by a preponderance of the evidence. DepÓt of

Banking & Fin. v. Osborne Stern & Co., Inc. , 670 So. 2d 932 (Fla.

1996); City of Hollywood v. Hogan , 986 So. 2d 634, 642 ( Fla. 4th

DCA 2008 ) .

31. What the reason is for an employeeÓs termination is a

factual matter. The opinion in Russell v. KSL Hotel Corp oration ,

887 So. 2d 372 (Fla. 3d DCA 2004) , illustrates this clearly.

Ms. Russell brought an action against her former employer, KSL

Hotel Corporation, for sexual harassment and retaliatory

discharge. The jury found for her on bo th claims and awarded

$1,516,00 in damages. The hotel filed a Motion for Judgment

Notwithstanding the Verdict or in the Alternative for New Tri al.

The trial court granted the motion.

32. The Third District Court of Appeal reversed because the

record contained evidence that would support a factual

determination that the hotel harassed and retaliated against

Ms. Russell. The courtÓs discussio n of the retaliation claim

emphasized the presence of evidence that, reasonably interpreted,

showed a causal connection between her sexual harassment

complaint and her discharge. Both the occurrence of sexual

harassment and the reason for discharge were m atters of fact for

the jury.

33. Here the weight of the persuasive, credible evidence

does not prove that Xencom terminated Petitioners in retaliation

or terminated Mr. Harrison and Mr. Smithers on account of their

sex. Xencom terminated Petitioners be cause the contract they

were hired to work on was terminated.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Florida Commission on Human

Relations issue a final o rder denying the petitions of all

Petitioners.

DONE AND ENTERED this 1 5 th day of May , 2018 , in Tallahassee,

Leon County, Florida.

S

JOHN D. C. NEWTON, II

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Park way

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 1 5 th day of May, 2018 .

ENDNOTE S

1/ All citations to Florida Statutes are to the 201 6 codification

unless otherwise noted.

2/ Mr. Harrison testified that he accidentally recorded the

meeting by leaving his recorder in the meeting room earlier in

the day. The recording was admitted over objection. When

Mr. Harrison initially disclosed the recording, he lied about how

it was created. This admitted willingness to lie affected the

credibility and persuasiveness of Mr. HarrisonÓs testimony.

COPIES FURNISHED:

Tammy S. Barton, Agency Clerk

Florida Commission on Human Relations

4075 Espl anade Way , Room 110

Tallahassee, Florida 32399 - 7020

(eServed)

Robert W. Bauer, Esquire

Law Office of Robert W. Bauer P.A.

Suite 1B

2610 Northwest 43rd Street

Gainesville, Florida 32606

(eServed)

Robert E. Luxen, Esquire

Hallet & Perrin

Suite 2400

1445 R oss Avenue

Dallas, Texas 75202

(eServed)

Cheyanne Costilla, General Counsel

Florida Commission on Human Relations

Room 110

4075 Esplanade Way

Tallahassee, Florida 32399 - 7020

(eServed)

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right t o submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.