Procedural Error at Trial Dooms Claim That Barbers Were Employees Rather Than Independent Contractors

Romero v. Razzle Dazzle Barbershop, Inc. - Eleventh Circuit Court of Appeals

Facts:  Rosa Romero ("Romero") and Luis Mateo ("Mateo") worked as barbers at one of Razzle Dazzle's ("Razzle Dazzle") barbershops.  Romero and Mateo claimed that although they worked over 40 hours in a week, they did not receive overtime pay under the Fair Labor Standards Act ("FLSA").  They subsequently filed suit against their former employer.  Razzle Dazzle argued that its barbers were not entitled to overtime pay as they were independent contracts and therefore were exempt from the overtime provisions of the FLSA.

At trial, evidence was presented to the jury by both sides.  Romero and Mateo introduced confidentiality and non-compete agreements which described them as "employees."  A staff manual was also introduced that detailed a dress code, attendance policy, and description of various job related duties.  Romero and Mateo testified that they could not set their own hours, were not allowed to choose which hair products to use, and were required to wear specific uniforms.

The owner of Razzle Dazzle countered this testimony and stated that barbers were allowed to set their own schedules, wear what they wanted, could choose which hair products to use on their clients, and set their own prices.

The jury returned a verdict in favor of Razzle Dazzle.  Romero and Mateo's motion for judgment notwithstanding the verdict, and motion for new trial were denied.  The appeal to the Eleventh Circuit Court of Appeals subsequently followed.

Holding:  The Court dove head first into a procedural analysis of what happened at the trial court level.  Citing prior caselaw, the Court pointed out that a district court may only grant a judgment notwithstanding the verdict if it is requested before the case is submitted to a jury.  If a party fails to file this request before the case is submitted to a jury, the "renewed" motion may only be granted if plain error is shown.  Consequently, absent an abuse of discretion, the district court's disposition of a judgment notwithstanding the verdict will not be disturbed.

In this case, Romero and Mateo did not move for judgment notwithstanding the verdict before the case was submitted to the jury.  Therefore, the Court recognized that the only question on appeal was whether there was "any evidence to support the jury's verdict, irrespective of its sufficiency" or if an affirmance would lead to "a manifest miscarriage of justice."

As readers are likely aware, the FLSA provides overtime and minimum wage protections that only apply to employees, not independent contractors.  In the Eleventh Circuit, to determine whether a worker falls under the category of employee or exempted independent contractor, a court is to look at the "economic reality" of the relationship and whether the relationship demonstrates dependence.  Several factors have been established to guide the analysis:  "(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 opportunity for profit or loss depending upon his managerial skill; (3) the alleged employee's investment in equipment or materials required for his task, or his employment of workers; (4) whether the service rendered requires a special skill; (5) the degree of permanency and duration of the working relationship; (6) the extent to which the service rendered is an integral part of the alleged employer's business."

The Court noted that while conflicting testimony was given by Romero and Mateo and Razzle Dazzle, the jury was entitled to make a credibility determination.  In doing so, the Court held that some evidence was presented which supported the jury's findings in favor of Razzle Dazzle.

Judgment:  The Eleventh Circuit Court of Appeals upheld the jury verdict in favor of Razzle Dazzle, finding some evidence in the record to establish that the barbers were independent contractors and not employees.

The Takeaway:  This case had more to do with a nuanced analysis of procedural moves rather than an in depth examination of the independent contractor vs. employee dispute.  With that being said, I call attention to the Court's recognition that because Romero and Mateo did not move for a judgment notwithstanding the verdict before the case was submitted to the jury for consideration, the standard of review was very much in favor of the "victor" at the trial court level.  As a result, since there was some evidence introduced at trial that Romero and Mateo were independent contractors, the Court of Appeals properly applied the standard of review to find that this ruling should not be disturbed on appeal.

Majority Opinion Judge:  Per curiam

Date:  October 28, 2019

Opinion:  http://media.ca11.uscourts.gov/opinions/unpub/files/201812689.pdf