Latest Court Decisions Interpreting Massachusetts General L - PowerPoint Presentation

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Latest Court Decisions Interpreting Massachusetts General Laws, Chapter 149, Section 148B

Terence P. McCourt

MCLE

Boston, Massachusetts

October 21,

2015Slide2

MASSACHUSETTS INDEPENDENT CONTRACTOR TEST Employment Status Is Presumed Unless the Following is Established:Individual is free from control and direction in performance of the service;The service is performed outside the usual course of the business of the employer; andIndividual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed.Slide3

LiabilityTwo Step Analysis:Violation of Ch. 149, Section 148BViolation of other legal requirements such as wage lawSlide4

Independent Contractor 2015 Case Law DevelopmentsImpact of Other Laws on Independent Contractor Statute:Local RegulationState Law Federal LawSlide5

TAXI INDUSTRY AND IMPACT OF LOCAL REGULATIONSebago v. Boston Cab Dispatch, Inc.471 Mass. 321 (2015)Rule 403: City of Boston taxicab regulations.Consolidated cases regarding classification of drivers as independent contractors.Court looked at nature of industry and medallion leaseholder arrangements.Defendants carry their burden on all three prongs.Rule 403 does not trump state law (not preemption).Rule 403 creates a system whereby taxi drivers may operate as employees or as entrepreneurs/independent contractors.Slide6

REAL ESTATE INDUSTRY AND IMPACT OF STATE LAWMonell v. Boston Pads, LLC471 Mass. 566 (2015)Real estate salespeople filed a class action against several related real estate businesses, arguing that they should have been classified as employees rather than independent contractors. The defendant real estate companies countered that a real estate specific state law, which allows real estate salespeople to be engaged as independent contractors despite the control and supervision that brokers maintain over salespeople (G.L. c. 112, § 87RR), trumped the independent contractor law. Court held that the real estate statute prevailed based on rule of statutory construction that a specific statute controls over the provisions of a general statute.Slide7

DELIVERY INDUSTRY AND IMPACT OF FEDERAL LAWMassachusetts Delivery Association v. Healy2015 WL 4111413 (D. Mass. July 8, 2015)Request for declaratory relief that “B” Prong of Independent Contractor Law is preempted by Federal Aviation Administration Act which preempts certain state laws relating to motor carriers.MDA argued that converting independent contractors to drivers does impact “prices, routes and services” regulated by federal law.In 2014, First Circuit held that Section 148B concerns “transportation of property” and remanded to determine preemption question.

Preemption may be applicable if state law’s impact on “prices, routes, and services” is significant.District Court holding is that Section 148B has a significant effect on prices, routes and services, thus Prong B is preempted by federal law.Slide8

FEDERAL PREEMPTIONSchwann v. FedEx Ground Package Sys., Inc.2015 WL 501512 (D. Mass. Feb. 5, 2015)In light of First Circuit’s 2014 opinion in MDA Case, District Court allowed summary judgment in favor of defendant.Prong B is not severable from rest of statute, and “Section 148B is preempted as applied to motor carriers like FedEx.”Appeal has been filed and is scheduled to be heard in late 2015.Slide9

Terence P. McCourtManaging ShareholderGreenberg Traurig, LLPOne International PlaceBoston, MA 02110mccourtt@gtlaw.com617-310-6000