17-005081 Faith Tappan vs. The Mg Herring Group, Inc. Status: Closed Recommended Order on Friday, May 11, 2018.

Summary: Employees/Petitioners did not prove three requirements for "joint employment." Also, did not prove discharge because of retaliation or sex. Discharged because contract ended.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MICHAEL HARRISON, MARK SMITHERS,

CODY LUCAS, DAVID OKKER,

MARVIN L. RAGLAND,

JACOB P. MILLER, KYLIE SMITHERS,

FAITH TAPPAN, AND Case Nos. 17 - 5067

BERNARD BROOKS, 17 - 5069

17 - 5071

Petitioners, 17 - 5073

17 - 5075

vs. 17 - 5077

17 - 5079

THE MG HERRING GROUP, INC., 17 - 5081

17 - 5411

Respondent.

_______________________________/

RECOMMENDED ORDER

Administrative 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 Off ice of Robert W. Bauer P.A.

Suite 1B

2610 Northwest 43rd Street

Gainesville, Florida 32606

For Respondent: Carrie Stolzer Robinson, Esquire

Tobin & Reyes, P.A.

Suite 51 0

225 Northeast Mizner Boulevard

Boca Raton, Florida 33432

STATEMENT OF THE ISSUE

Whether Respondent, The MG Herring Group, Inc. ( MG Herring) ,

was an employer of Petitioners.

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 Relations (Commission) against

MG Herring and Xencom Facility Man agement, LLC (Xencom), under

the Flo rida Civil Rights Act of 1992, c hapter 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 complaining. The other seven

Petitioners alleged that MG Herring retaliated against them

b ecause they had opposed a practice that wa s unlawful under

section 760.10 . All Petitioners asserted that MG Herring was

their employer by virtue of a joint employer relationship with

Xencom.

The same nine Petitioners filed charges of discrimination by

dis charge 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 unlawful

employment practice.

In each case, the Commission issued a ÐDetermination: N o

Reasonable Cause.Ñ The Commission concluded that MG Herring did

not employ Petitioners. The Commission also concluded that

Xencom terminated PetitionersÓ employment because 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 for conduct of a

final hearing and issuance of a r ecommended o rder.

The claims against Xencom wer e 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 committed 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 hearing, Petitioners presented testimony from

Norine Bowen, Michael Harriso n, Kylie Smithers, and Tina Wilson.

PetitionersÓ Exhibits 3 and 17 were admitted into evidence.

MG Herring presented the testimony of Norine Bowen and T ina

Wilson. MG Herring Exhibits 1 through 3, 8 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 retail 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 @ Heathbrook (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 Manager for Herring Ocala, LLC. The other was Bernard E.

McAuley, identified as Manager of Tricom Mark et 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 Property 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 inv olved, their compensation, and their

weekly number of hours. The contract exhibits also identified

operating costs, including equipment amortization, equipment

repairs, fuel expenses, vacation costs, health insurance, and

storage costs. The contracts end ed 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

Representa tives 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 contracts with different facilities.

6. As the contracts contemplate, only Xen com 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. In 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 h ave 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 Ap plication 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 definite 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 Property 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 O perations M anager , Mr. Harrison was also

responsible for facilitating payroll, procuring supplies, and

managing Xen c o m Ós equipment at the site.

11. X encom provided Petitioners work uniforms that bore

XencomÓs name. Xencom required Petitioners to wear the uniforms

at work. Xencom provided the supplies and equipment that

Petitioners used at work.

12. Only Xencom had authority to hire or fire the emplo yees

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

Prope rty Group.

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

employed 15 or more people.

14. Property Group hired Tina Wil son as Market StreetÓs on -

site G eneral M anager 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 primary 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, construction management, and

contract management. She managed approximately 40 contra cts at

Market Street, including XencomÓs three service agreements.

Ms. Wilson was responsible for making sure the contracts were

properly executed. Managing the Xencom cont racts consumed less

than 50 per cent of Ms. WilsonÓs time.

16. During the last we eks 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. Smithers assist her with office work such as

filing and making calls. Mr. H arrison 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. Harr ison 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. Harrison and Ms. Wilson. They may have been caused by having

a property manager rep resentative on - site after Mr. HarrisonÓs

years as either the manager representative himself or as Xencom

superviso r without a property manager on - site. They may have

been caused by personality difference s 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 xencomempoyees@gmai l.com 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 alcohol 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 drink 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 an 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 mon thly 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 Garrett,

and youÓre meeting with Danny [intended new

Xencom manager for Marke t 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

drinking on property, off the clock or on the

clock, you know, whatever, what thei r 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 exchang e 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

discussing a serious complaint they had received, their plan to

investigate it, a nd 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 tim e 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 M r. 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 a bout 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 Stre et at Heathbrook, LLC,

terminating the service agreement s . Their agreement s with Xencom

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

negotiating s uccessor agreement s . Ho wever, they had not executed

any .

26. Xen c o m terminated Petitioners Ó emplo yment 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

jurisd iction over the subject matter of this proceeding and of

the parties. §§ 120.569 and 120.57(1), Fla. Stat. (2017 ).

28. Petitioners must prove their claim that MG Herring was

their employer by a preponderance of the evidence. DepÓt of

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

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

DCA 2008).

29. Petitioners seek relief from an unlawful employment

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

prohibit an employ er from discriminating against an employee on

account of sex and from retaliat ing against an employee opposing

an unlawful employment practice.

30. Section 760.02(7) defines employer as Ðany person

employing 15 or more employees for each working day in e ach of 20

or more calendar weeks in the current or preceding calendar year,

and any agent of such person.Ñ Petitioners did not prove that

MG Herring was an employer as the law defines employer. For that

matter, Petitioners did not prove that any MG Herr ing - related

entity was an employer as section 760.02(7) defines the term.

31. Recognizing this , Petitioners argue that MG Herring was

their joint employer with Xencom. Joint employment is primarily

a factual issue. Supervision of day - to - day activities, authority

to hire or fire, promulgation of work rules, and authority to

make work assignments can all be indicia of a joint employment

relationship. Holyoke Visiting Nurses Ass'n v. NLRB , 11 F.3d

302, 306 (1st Cir. 1993). The record in this cause does no t

prove the existence of any of these factors.

32. The opinion in Morrison v. Magic Carpet Aviation , 383

F.3d 1253 (11th Cir. 2004), at 1255, identifies three factors to

consider when deciding whether an entity is an individualÓs

employer. They are (1) w hether the alleged employment took place

on the premises of the alleged employer, (2) how much control the

alleged employer exerted over the alleged employee, and

(3) whether the alleged employe r had the authority to hire or

fire the alleged employee or m odify her conditions of employment.

See also Jerome v. Hertz Corp. , 15 F. Supp. 3d 1225, 1236 - 37

(M.D. Fla. 2014). Petitioners proved only the location factor.

MG Herring and Property Group did not establish tasks, work

hours, employee schedules or the means of accomplishing tasks for

Petitioners. MG Herring and Property Group did not have any

authority to hire or fire Petitioners or modify the conditions of

their employment. The only control MG Herring and Property Group

had over Petitioners was to i nsist that their employer, Xencom,

provide services as required by the contract. In addition, if

the facts showed that MG Herring pressured Xen c o m to discharge an

employee, Ð[t]he simple fact that a major client can pressure an

employer into firing a part icular individual does not transmute

that client into that individualÓs employer.Ñ Morrison v. Magic

Carpet Aviation , 383 F.3d 1253, 1255 (11th Cir. 2004).

Petitioners did not prove by a preponderance of the evidence that

MG Herring or Property Group was their joint employer with

Xencom.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that Florida Commission on Human Relations

enter a final o rder denying the Petitions of all Petitioners.

DONE AND ENTERED t his 11th 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 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 11th day of May, 2018 .

ENDNOTE S

1/ All citations to Florida Statutes are to the 2016 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 ho w

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

Room 110

4075 Esplanade Way

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)

Carrie Stolzer Robinson, Esquire

Tobin & Reyes, P.A.

Suite 510

225 Northeast Mizner Boulev ard

Boca Raton, Florida 33432

(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 to 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.