Smith et al v. Phoenix, City of

Filing 61

ORDER that Plaintiffs' 55 Motion for Partial Summary Judgment is granted. Plaintiffs are granted summary judgment that they are neither independent contractors nor volunteers for purposes of the FLSA. Signed by Judge H Russel Holland on 11/5/15.(KGM)

WO

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ARIZONA

JOAN K. SMITH, an individual; and
ROBERTA E. TATE, an individual,

)
)
)
Plaintiffs,
)
)
vs.
)
)
CITY OF PHOENIX, a municipal corporation, )
)
Defendant.
)
__________________________________________)

No. 2:14-cv-0936-HRH

ORDER
Motion for Partial Summary Judgment
Plaintiffs move for summary judgment on the issue of whether they are non-exempt
employees for purposes of the Fair Labor Standards Act.1 This motion is opposed.2 Oral
argument has not been requested and is not deemed necessary.
Facts
Plaintiffs are Joan Karen Smith and Roberta Tate. Defendant is the City of Phoenix.

1

Docket No. 55.

2

Docket No. 58.
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Plaintiffs worked as resident assistants (RAs) at Pine Tower, a senior housing facility
owned and operated by defendant. Smith worked as a RA from May 2007 through April
2014. Tate worked as a RA from September 2009 through February 2014.
Plaintiffs signed a Tenant Resident Assistant (TRA) Agreement each year that they
were RAs. The TRA Agreement provided that an RA “shall be an independent contractor
and shall not be an employee of the City.”3 The TRA Agreement further provided that the
RA “agrees that he or she is not an employee of the City[.]”4 Diane Reifenstahl, a property
manager for defendant, testified that the RAs were independent contractors.5 Pene Norville,
defendant’s housing manager and Rule 30(b)(6) witness, testified that the RAs were “kind
of right in the middle of” being a volunteer and an independent contractor, that they were
a “[c]ombination of both.”6
Attached to the TRA Agreement was a list of services that RAs were to provide:
<

Follow any directions provided by the Housing, Law,
Fire and Police Departments.

3

TRA Agreement at 3, ¶ 6, Exhibit A, Defendant’s Controverting Statement of Facts
[etc.], Docket No. 59.
4

Id.

5

Deposition of Diane Reifenstahl at 19:22-24, Exhibit E, Defendant’s Controverting
Statement of Facts [etc.], Docket No. 59.
6

Deposition of Pene Norville at 34:10-17, Exhibit A, Reply in Support of Plaintiffs’
Motion for Partial Summary Judgment, Docket No. 60.
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<

Respond promptly to all emergency calls.

<

Complete incident reports on all unusual or emergency
incidents.

<

Tactfully inform residents of lease violations and report
them to the administrative staff.

<

Coordinate activities with administrative staff and the
other tenant resident assistants.

<

Cooperate with all City services and departments, and
follow subsequent memoranda from them.

<

Secure apartments in case of death or lengthy illness.

<

Conduct security checks on all doors leading to the
outside periodically and on an as needed basis.

<

Conduct security checks of entire area, inside and
outside, periodically and on an as-needed basis. Checks
must be more frequent on Saturdays, Sundays and
holidays.

<

Lock all doors leading to the outside by the assigned time
and permit only individuals with legitimate reason to
enter the premises.

<

Notify emergency maintenance personnel and Housing
Program Assistant of any condition which needs prompt
attention, such as air conditioner failure, major electrical
outage, leaking or broken piping, etc.

<

Report all non-emergency maintenance problems to
administrative staff.

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<

Perform light housekeeping duties in public areas, as
needed or as directed and maintain the Tenant Resident
Assistant’s apartment.

<

Tenant Resident Assistant must live in the project and be
responsible for and respond to tenants’ legitimate
requirements.

<

Answer City phone in a courteous and timely manner.

<

Other duties as may be reasonably required.

<

No personal use of telephone provided by the Housing
Department is permitted.[7]

The Scope of Services exhibit that was attached to the TRA Agreement
also provided that
[t]he Tenant Resident Assistant shall perform the services
required under this Agreement from 8:00 a.m. through 5:00 p.m.
Monday through Friday, every other week. Services after 5:00
p.m. on weekdays and all day on Saturdays, Sundays and
holidays are limited to emergencies, locking and un-locking
doors, and security checks.[8]
Smith testified that her workweek “started ... on a Monday at 8:00 o’clock, and I
ended my week the following Monday at 8.00.”9 However, there is a work schedule

7

Scope of Services for Tenant Resident Assistant Services at 1-2, Exhibit A, Amended
and Restated Tenant Resident Assistant Agreement, Exhibit B, Plaintiffs’ Motion for Partial
Summary Judgment, Docket No. 55.
8

Id. at 2.

9

Deposition of Joan Karen Smith at 86:24-87:1, Exhibit A, Plaintiffs’ Motion for Partial
(continued...)
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calendar in evidence that shows that plaintiffs created their own work schedule and that
they did not work seven days in a row.10
Smith testified that on the days that she worked, she was required to be available 24
hours per day.11 Tate testified that she did not leave the premises when she was on duty.12
Reifenstahl testified that RAs “had to remain on the property” when they were on duty.13
Norville testified that defendant “prefers” that the RAs remain on site while on duty.14
Smith testified that other duties she performed as a RA included delivering monthly
rent statements, delivering other notices to tenants, signing contractors in and out of the
facility, and monitoring for unauthorized persons.15 RAs would also respond if the front

9

(...continued)
Summary Judgment, Docket No. 55.
10

Exhibit G, Defendant’s Controverting Statement of Facts [etc.], Docket No. 59.

11

Smith Deposition at 47:24-48:2, Exhibit A, Plaintiffs’ Motion for Partial Summary
Judgment, Docket No. 55.
12

Deposition of Roberta Elise Tate at 30:17-19, Exhibit H, Plaintiffs’ Motion for Partial
Summary Judgment, Docket No. 55.
13

Reifenstahl Deposition at 14:24-25, Exhibit E, Defendant’s Controverting Statement
of Facts [etc.], Docket No. 59.
14

Norville Deposition at 25:18-20, Exhibit D, Defendant’s Controverting Statement of
Facts [etc.], Docket No. 59.
15

Smith Deposition at 89:16-19; 106:11-14; 141:22-142:6, Exhibit A, Plaintiffs’ Motion
for Partial Summary Judgment, Docket No. 55.
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gate would not open at night.16 A RA could get up to two to three calls per hour from
tenants in need of assistance.17 But, an RA might get fewer calls as well. For example,
Smith’s sister testified that Smith would only get one to two calls or knocks on her door
during a four-to-five hour period.18
After hours, RAs were to respond to emergencies such as fire, flood and medical
emergencies. Residents could call the RA in case of an emergency and the RA would then
call 911. However, Reifenstahl testified that RAs were not required to answer calls that came
in after hours,19 and residents could call 911 themselves or call a maintenance emergency
number themselves.
RAs received a rent-free apartment and a monthly stipend of $200.00. Smith’s rent
would have been $456.00 per month had she not been an RA and Tate’s would have been
$250.00.
In the general information sheet that was provided to Pine Tower residents,
defendant advised residents that

16

Deposition of Earnestine T. Pittman at 25:12-19, Exhibit C, Plaintiffs’ Motion for
Partial Summary Judgment, Docket No. 55.
17

Id. at 23:3-19.

18

Deposition of Peggy Yost at 21:18-22:9, Exhibit L, Defendant’s Controverting
Statement of Facts [etc.], Docket No. 59.
19

Reifenstahl Deposition at 14:6-10, Exhibit E, Defendant’s Controverting Statement
of Facts [etc.], Docket No. 59.
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[f]or your protection, there is a Resident Assistant on duty 24
hours per day, 7 days per week. The Resident Assistants will act
on behalf of the office if the manager is not available, and will
assist with fire, life, safety and maintenance emergencies and all
other management issues. As the Resident Assistant is on duty
for such extended hours, we ask that non-emergency items (i.e.,
packages, rent statements) wait until regular business hours.
Please do not disturb the Resident Assistant who is off duty.[20]
In addition to the RAs, Pine Tower had a property manager who was on the premises
during the weekdays. There were also two full-time maintenance workers and a full-time
service coordinator on the premises during the weekdays.
On May 1, 2014, plaintiffs commenced this action in which they assert two claims
under the Fair Labor Standards Act (FLSA): 1) a minimum wage violation and 2) an
overtime violation. Plaintiffs now move for summary judgment that they were non-exempt
employees for purposes of the FLSA and not independent contractors or volunteers.
Discussion
Summary judgment is appropriate when there are no genuine issues of material fact
and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). The
initial burden is on the moving party to show that there is an absence of genuine issues of
material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). If the moving party meets
its initial burden, then the non-moving party must set forth specific facts showing that there

20

Pine Tower General Information Sheet, Exhibit F, Plaintiffs’ Motion for Partial
Summary Judgment, Docket No. 55.
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is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). In
deciding a motion for summary judgment, the court views the evidence of the non-movant
in the light most favorable to that party, and all justifiable inferences are also to be drawn
in its favor. Id. at 255. “[T]he court’s ultimate inquiry is to determine whether the ‘specific
facts’ set forth by the nonmoving party, coupled with undisputed background or contextual
facts, are such that a rational or reasonable jury might return a verdict in its favor based on
that evidence.” T.W. Elec. Service, Inc. v. Pacific Elec. Contractors Ass’n, 809 F.2d 626, 631
(9th Cir. 1987).
“The FLSA provides that ‘[e]very employer shall pay to each of his employees who
in any workweek is engaged in commerce or in the production of goods for commerce, or
is employed in an enterprise engaged in commerce or in the production of goods for
commerce,’ a minimum wage.” Boucher v. Shaw, 572 F.3d 1087, 1090 (9th Cir. 2009) (quoting
29 U.S.C. § 206(a)). In addition, “no employer shall employ any of its covered employees for
a work week that is longer than 40 hours unless that employee receives as compensation for
his employment at least one and a half times the regular rate for all overtime hours.”
Forrester v. Roth’s I. G. A. Foodliner, Inc., 646 F.2d 413, 414 (9th Cir. 1981). But, defendant
contends that the FLSA does not apply to plaintiffs because they were not “employees.”
First, defendant argues that plaintiffs were independent contractors rather than
employees. Although plaintiffs’ contracts state that they were independent contractors,

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“[e]conomic realities, not contractual labels, determine employment status for the remedial
purposes of the FLSA.” Real v. Driscoll Strawberry Associates, Inc., 603 F.2d 748, 755 (9th
Cir. 1979). To determine whether a person is an employee rather than an independent
contractor for purposes of the FLSA, “courts have identified a number of factors that should
be considered.” Donovan v. Sureway Cleaners, 656 F.2d 1368, 1370 (9th Cir. 1981).
“Although the list is not exhaustive,” the six factors the court should consider are:
“1) the degree of the alleged employer’s right to control 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 helpers;
4) whether the service rendered requires a special skill;
5) the degree of permanence of the working relationship; and
6) whether the service rendered is an integral part of the alleged
employer’s business.”
Id. (quoting Real, 603 F.2d at 754). “The presence of any individual factor is not dispositive
of whether an employee/employer relationship exists. Such a determination depends ‘upon
the circumstances of the whole activity.’” Real, 603 F.2d at 754 (quoting Rutherford Food
Corp. v. McComb, 331 U.S. 722, 730 (1947)). “The existence and degree of each factor is a
question of fact while the legal conclusion to be drawn from those facts—whether workers

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are employees or independent contractors—is a question of law.” Brock v. Superior Care,
Inc., 840 F.2d 1054, 1059 (2nd Cir. 1988).
Based on the totality of the circumstances here, as a matter of law, plaintiffs were not
independent contractors. Although defendant did not exert total control over the manner
in which plaintiffs’ work was to be done, defendant provided a list of duties that plaintiffs
were to perform and the Pine Tower manager at times assigned additional tasks to them
such as helping to prepare and deliver the monthly rent statements.21
Plaintiffs were not provided an opportunity for profit or loss based on work
performance. The fact that Smith was able to have other jobs while working as an RA does
not suggest that she had the opportunity for profit.22 Employees may work for more than
one employer without losing the protections afforded by the FLSA. Walling v. Twyeffort,
Inc., 158 F.2d 944, 947 (2nd Cir. 1947).
As Norville testified, plaintiffs were not required to purchase any specific tools or
equipment in order to do their jobs.23 Rather, plaintiffs were provided a specific apartment

21

Smith Deposition at 104:3-105:4, Exhibit A, Plaintiffs’ Motion for Partial Summary
Judgment, Docket No. 55.
22

Smith worked at the nursing home where her mother lived for a period of time and
also worked two days a month as an aesthetician at two different senior housing facilities.
23

Norville Deposition at 28:2-5, Exhibit A, Reply in Support of Plaintiffs’ Motion for
Partial Summary Judgment, Docket No. 60.
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by defendant that had a city phone and fire alarm system in it.24 In addition, Smith testified
that the phone log books that the RAs used for a time were provided to them by defendant.25
The fact that Smith used her own cell phone to perform her tasks26 was nothing more than
a matter of convenience.
Plaintiffs also did not employ assistants. Although defendant has offered evidence
that plaintiffs had people help them with their tasks, there is no evidence that plaintiffs
“employed” these helpers. Rather, the “helpers” were friends and relatives of Smith who
would help out when visiting Smith.
Being an RA did not require any special skills. Rather, as Norville testified, RAs were
“typically very low-functioning individuals.”27
There was a high degree of permanence in the working relationship, even though
plaintiffs signed a new contract each year. Smith was an RA for almost 7 years and Tate was
an RA for over three years. Norville’s testimony is not to the contrary. Although Norville

24

Norville Deposition at 18:22-19:4, Exhibit D, Plaintiffs’ Motion for Partial Summary
Judgment, Docket No. 55.
25

Smith Deposition at 58:8-14, Exhibit A, Plaintiffs’ Motion for Partial Summary
Judgment, Docket No. 55.
26

Smith Deposition at 129:2-25, Exhibit B, Defendant’s Controverting Statement of
Facts [etc.], Docket No. 59.
27

Norville Deposition at 16:14-18, Exhibit D, Plaintiffs’ Motion for Partial Summary
Judgment, Docket No. 55.
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testified that currently there is only one RA who has been in that position for more than one
year,28 Norville also testified that “we have had them [RAs] go from two months to 10 years
or maybe even longer.”29
The services that the RAs provide may not be integral to defendant’s operation of
senior housing facilities as evidenced by the fact that not all of defendant’s senior housing
facilities have RAs.30 But, as Norville testified, having RAs provides “a benefit to the
residents, yes.”31
The fact that either party could terminate the RA contract also suggests an employee
relationship.32 See Mathis v. Housing Authority of Umatilla County, 242 F. Supp. 2d 777, 785
(D. Or. 2002) (“The Section 8 Coordinator position was for an indefinite duration and either
party could terminate the relationship at any time.

These facts favor an employee

relationship.”). And the fact that plaintiffs have no identifiable business entity holding itself
out as a provider of special services suggests that plaintiffs were not independent contractors

28

Norville Deposition at 31:5-10, Exhibit D, Defendant’s Controverting Statement of
Facts [etc.], Docket No. 59.
29

Id. at 31:2-3.

30

Id. at 44:15-20.

31

Norville Deposition at 14:6-11, Exhibit D, Plaintiffs’ Motion for Partial Summary
Judgment, Docket No. 55.
32

Id. at 15:20-21 (“We have contracts with them and either party can give a 30-day
notice to terminate the contract”).
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as does the fact that plaintiffs have no separate place of business, but rather were required
to reside on defendant’s premises.
Secondly, defendant argues that plaintiffs were volunteers rather than employees.
For purposes of the FLSA, a volunteer is “[a]n individual who performs hours of service for
a public agency for civic, charitable, or humanitarian reasons, without promise, expectation
or receipt of compensation for services rendered[.]” 29 C.F.R. § 553.101. “Volunteers may
be paid expenses, reasonable benefits, a nominal fee, or any combination thereof, for their
service without losing their status as volunteers.” Id. § 553.106(a). “A nominal fee is not a
substitute for compensation and must not be tied to productivity.” Id. at § 553.106(e).
“Congress did not intend to discourage or impede volunteer activities undertaken for civic,
charitable, or humanitarian purposes” but “[i]ndividuals shall be considered volunteers only
where their services are offered freely and without pressure or coercion, direct or implied,
from an employer.” Id. at § 553.101(b) & (c). “Whether someone is an employee or a
volunteer for purposes of the FLSA is a question of law to be determined by the court.”
Vonbrethorst v. Washington County, Idaho, Case No. CV06–0351–SEJL, 2008 WL 2785549,
at *3 (D. Idaho July 15, 2008).
As a matter of law, plaintiffs were not volunteers. On an annual basis, Smith received
$5,472 in free rent and Tate received $3,000 in free rent. When this is added to the $2,400 in
stipends that they received, Smith received annual compensation of $7,872 and Tate received

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$5,400, which is more than a nominal amount. These amounts represent compensation, not
reasonable benefits or nominal fees. It is also significant that plaintiffs signed contracts with
defendant each year. A volunteer is not typically required to sign what in this case was
basically an employment contract.33 And, even if plaintiffs were motivated to become RAs,
at least in part, by civic, charitable, or humanitarian reasons, the fact that they were being
compensated for their work means that they were not volunteers.
Conclusion
Plaintiffs’ motion for partial summary judgment34 is granted. Plaintiffs are granted
summary judgment that they are neither independent contractors nor volunteers for
purposes of the FLSA.
DATED at Anchorage, Alaska, this 5th day of November, 2015.
/s/ H. Russel Holland
United States District Judge

33

Plaintiffs also offered an “employment opportunity” flyer in support of their
argument that they were not volunteers. Exhibit G, Plaintiffs’ Motion for Partial Summary
Judgment, Docket No. 55. But, as defendant points out, this flyer was from Scott Business
Group, not defendant.
34

Docket No. 55.
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