Gil et al v. Pizzarotti, LLC et al
Filing
119
OPINION AND ORDER DENYING MOTION FOR SUMMARY JUDGMENT re: 87 MOTION for Summary Judgment filed by Ignazio Campoccia, Giacomo Di'Nola, Pizzarotti, LLC. For the reasons discussed above, the PZ Defendants' mot ion for summary judgment is DENIED. Plaintiffs shall file their anticipated motion for class certification, for certification of a collective action, or both on or before April 13, 2021. (See Scheduling Order [ECF No. 77].) The Clerk of Court is respectfully requested to terminate docket entry 87. ( Motions due by 4/13/2021.) (Signed by Judge Mary Kay Vyskocil on 3/29/2021) (mro)
USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #:
DATE FILED:
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
ANDY GIL and RAFAEL HERNANDEZ, on behalf of
themselves and all other similarly situated,
Plaintiffs,
1:19-cv-03497-MKV
-againstPIZZAROTTI, LLC., ATLANTIC CONTRACTING OF
YONKERS, INC., JOEL ACEVEDO, IGNAZIO
CAMPOCCIA, GIACOMO DI’NOLA a/k/a GIACOMO
DI NOLA, JOHN DOE CORPORATIONS 1-10, and
RICHARD ROES 1-10,
OPINION AND ORDER
DENYING MOTION FOR
SUMMARY JUDGMENT
Defendants,
MARY KAY VYSKOCIL, United States District Judge:
Plaintiffs Andy Gil and Rafael Hernandez, now joined by over thirty opt-in plaintiffs
(collectively, “Plaintiffs”), brought this putative class or collective action asserting claims for
unpaid overtime wages under the Fair Labor Standards Act (“FLSA”) and New York Labor Law
(“NYLL”). Plaintiffs have sued Atlantic Contracting of Yonkers, Inc. (“Atlantic”), its co-owner
Joel Acevedo, and three other defendants: Pizzarotti LLC (“PZ”), Giacomo Di’Nola, and Ignazio
Campoccia (collectively, the “PZ Defendants”). Plaintiffs are former employees of Atlantic, which
was retained by PZ as a subcontractor in connection with a construction project for which PZ
served as the general contractor. The PZ Defendants moved for summary judgment on the ground
that they were not Plaintiffs’ “employers” under the FLSA and NYLL and therefore cannot be
liable for unpaid overtime compensation. For the reasons discussed below, the PZ Defendants’
motion is DENIED.
1
BACKGROUND
A. Factual Background 1
PZ is a global construction company that provides construction management services.
(Pls.’ Resp. Defs.’ 56.1 Statement (“Pls.’ 56.1”) ¶ 1 [ECF No. 101].) PZ was hired to serve as the
construction manager, or general contractor, for a large building project in Manhattan (the “Jardim
Project”). (Pls.’ 56.1 ¶ 4.) In this role, PZ was required to coordinate and manage various
subcontractors and oversee day-to-day operations to ensure timely completion of the Jardim
Project, at or under budget, to the owner’s expected standard of quality. (Pls.’ 56.1 ¶¶ 6, 9.)
As construction manager, PZ was not responsible for having its own employees perform
construction work. (Pls.’ 56.1 ¶ 7.) Defendant Ignazio Campoccia, PZ’s Project Executive, was
responsible for supervising all operations and communicating with the property owner. (Pls.’ 56.1
¶ 10.a.i.) Roberto Maddedu, PZ’s Senior Project Manager, was responsible for managing PZ
personnel, confirming that the Jardim Project was developed as planned, and ensuring that
subcontractors executed their work in accordance with their respective contracts. (Pls.’ 56.1
¶ 10.b.) If the project owner was not satisfied with portions of the construction project, Maddedu
and Campoccia would address the issue with the subcontractor’s owner, foremen, or both. (Pls.’
56.1 ¶ 10.b.i.) Defendant Giacomo Di’Nola, PZ’s Project Engineer, was responsible for the overall
1
The following facts are undisputed unless otherwise noted. The Court generally cites to Plaintiffs’ 56.1 Response
Statement because it contains both the PZ Defendants’ assertions and Plaintiffs’ responses. The PZ Defendants ask
the Court to strike or deem as admissions various responses in Plaintiffs’ 56.1 Response Statement. (See generally
Defs.’ Reply Pls.’ 56.1 Statement [ECF No. 105].) The Court “does not blindly accept [the parties’] 56.1 Statement[s]
at face value, as allegations are not deemed true simply by virtue of their assertion in the Local Rule 56.1 statement.”
RP Family, Inc. v. Commonwealth Land Title Ins. Co., No. 10–CV–1149 (DLI)(CLP), 2014 WL 1330932, at *1
(E.D.N.Y. Apr. 1, 2014) (quoting Suares v. Cityscape Tours, Inc., No. 11 Civ. 5650(AJN), 2014 WL 969661, at *2
(S.D.N.Y. Mar. 12, 2014)). The Court has carefully reviewed the parties’ 56.1 Statements and has independently
assessed the underlying record to determine whether material factual disputes exist and summary judgment is
appropriate. See Victory v. Pataki, 814 F.3d 47, 59 (2d Cir. 2016) (“If, as to the issue on which summary judgment is
sought, there is any evidence in the record from which a reasonable inference could be drawn in favor of the
nonmoving party, summary judgment is improper.” (quoting Rodriguez v. City of New York, 72 F.3d 1051, 1061 (2d
Cir. 1995))).
2
day-to-day tasks on the Jardim Project, including ordering materials, scheduling completion of
construction tasks, ensuring construction was completed according to plan, and handling invoices
for subcontractors. (Pls.’ 56.1 ¶ 10.c.)
In connection with the Jardim Project, PZ entered into agreements with subcontractors for
various forms of construction work. (Pls.’ 56.1 ¶ 11.) PZ contracted with Atlantic for carpentry,
drywall, and taping (i.e., preparing sheetrock to be painted) services. (Pls.’ 56.1 ¶¶ 15, 18.)
Pursuant to the contract, PZ was obligated to pay Atlantic $30 an hour for all labor it performed
and to supply all materials (commonly known as a “time and material contract”). (Pls.’ 56.1 ¶ 20.)
Hector Miranda worked as an Atlantic foreman. (Pls.’ 56.1 ¶ 36.) When Plaintiffs learned
of openings at the Jardin Project, they met with Miranda or other foremen who discussed the nature
of the work, the workers’ taping experience, scheduling, and pay. (Pls.’ 56.1 ¶¶ 35, 42–43, 45.)
When hired, Atlantic employees were told that they would work for Atlantic. (Pls.’ 56.1 ¶ 35.)
Generally, the foremen directed and supervised Atlantic’s workers, providing instructions,
answering questions, and overseeing the completion of tasks. (Pls.’ 56.1 ¶¶ 59, 61, 65.) The
foremen reported to Atlantic owners about the progress of the Jardim Project. (Pls.’ 56.1 ¶ 66.)
Atlantic employees would contact foremen about work-related issues. (Pls.’ 56.1 ¶¶ 68–71.)
Because the PZ-Atlantic contract was a time and material contract, PZ wanted work by
Atlantic employees done properly so it would not have to pay for additional hours to correct
improper or inadequate work. (Pls.’ 56.1 ¶ 83.) No PZ employee working on the Jardim Project
had any formal training or work experience as carpenters or tapers. (Pls.’ 56.1 ¶ 76.) Yet if they
determined that work was not completed properly, PZ employees would speak to Atlantic foremen
to correct it. (Pls.’ 56.1 ¶ 84.) For major quality issues, PZ contacted Acevedo, a co-owner of
Atlantic, and sometimes scheduled walkthroughs of the worksite. (Pls.’ 56.1 ¶ 85.)
3
Atlantic created timesheets for employees to sign in and out and used the timesheets to
prepare invoices to send to PZ. (Pls.’ 56.1 ¶ 89.) As a foreman, Miranda’s first task each day was
to make sure that the sign-in sheets were placed at the entrance of the worksite. (Pls.’ 56.1 ¶ 90.)
Atlantic foremen instructed Atlantic employees to sign the timesheets. (Pls.’ 56.1 ¶ 91.) Di’Nola
would sometimes stand with Miranda and monitor Atlantic employees signing out to ensure there
were no false entries. (Pls.’ 56.1 ¶ 92.) Atlantic foremen kept originals of the timesheets, and
Di’Nola kept copies to verify the invoices PZ received from Atlantic. (Pls.’ 56.1 ¶ 94.) Di’Nola
would review the timesheets, and if there were disagreements about the number of hours worked,
PZ would address it with Atlantic. (Pls.’ 56.1 ¶¶ 124, 126.)
Newly hired Atlantic employees did not meet or discuss pay issues with PZ employees.
(Pls.’ 56.1 ¶ 108.) Atlantic foremen told new employees their hourly wage and that they would
receive raises if they did well. (Pls.’ 56.1 ¶¶ 109, 111.) Some Atlantic employees requested and
received raises through Atlantic foremen. (Pls.’ 56.1 ¶¶ 112–13.) Acevedo, Atlantic’s co-owner,
approved the raises. (Pls.’ 56.1 ¶ 117.)
On a weekly basis, Atlantic’s owners would come to the worksite and distribute envelopes
with checks or cash to Atlantic employees. (Pls.’ 56.1 ¶¶ 128–29.) No Atlantic employee received
a check or cash from PZ. (Pls.’ 56.1 ¶ 130.) Employees generally raised issues regarding pay,
namely missing hours, with Atlantic’s owners or foremen. (Pls.’ 56.1 ¶ 132.)
After several months, Atlantic was replaced with another subcontractor because it failed to
perform sufficiently under the PZ-Atlantic contract. (Pls.’ 56.1 ¶¶ 26–27.)
B. Procedural Background
Shortly thereafter, Plaintiffs Gil and Hernandez commenced this putative class or collective
action seeking to recover unpaid overtime wages from Atlantic, Acevedo, and the PZ Defendants.
4
(Compl. [ECF No. 1].) Plaintiffs Gil and Hernandez allege that they routinely worked more than
forty hours per week. (See Am. Compl. ¶¶ 36–49 [ECF No. 30].) The PZ Defendants answered
and asserted cross claims for indemnity and contribution against Atlantic and Acevedo. (Answer
Am. Compl. [ECF No. 33].) Plaintiffs Gil and Hernandez have since been joined by over thirty
opt-in plaintiffs. (Consent Become Party Pl. [ECF Nos. 37–38, 41–43, 46–49, 51–52, 104, 118].)
The PZ Defendants moved for summary judgment on the ground that they were not
Plaintiffs’ employers under the FLSA and NYLL. (Defs.’ 56.1 Statement [ECF No. 86]; Mot.
Summ. J. [ECF No. 87]; Defs.’ Br. [ECF No. 88]; Campoccia Decl. [ECF No. 89]; Ho. Decl. [ECF
No. 90].) Plaintiffs filed an opposition (Harrison Decl. [ECF No. 94]; Juarez Decl. [ECF No. 96];
Portillo Decl. [ECF No. 97]; Familia Decl. [ECF No. 98]; Sarabia Decl. [ECF No. 99]; Pls.’ Opp.
[ECF No. 100]; Pls.’ 56.1 [ECF No. 101]; Aguirre Decl. [ECF No. 107]), and the PZ Defendants
filed a reply (Reply [ECF No. 106]; Defs.’ 56.1 Reply Statement [ECF No. 105]).
Shortly after this motion was fully briefed, the Court entered default judgment against
Atlantic and Acevedo as to liability on Plaintiffs’ claims and the PZ Defendants’ cross claims for
indemnity and contribution. (Default J. [ECF Nos. 114–15].)
LEGAL STANDARDS
A. Summary Judgment Standard
“Summary judgment is appropriate only when, ‘the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.’” YaChen Chen v. City Univ. of N.Y., 805 F.3d 59, 69 (2d Cir. 2015) (quoting Fed. R. Civ. P. 56(a)).
“[T]he mere existence of some alleged factual dispute between the parties will not defeat an
otherwise properly supported motion for summary judgment; the requirement is that there be no
genuine issue of material fact.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48 (1986). A
5
fact is material if it “might affect the outcome of the suit under the governing law.” Id. at 248. A
material factual dispute is genuine “if the evidence is such that a reasonable jury could return a
verdict for the nonmoving party.” Id. The Court’s role here “is not to resolve disputed issues of
fact but to assess whether there are any factual issues to be tried.” Brod v. Omya, Inc., 653 F.3d
156, 164 (2d Cir. 2011) (quoting Wilson v. Nw. Mut. Ins. Co., 625 F.3d 54, 60 (2d Cir. 2010)).
The moving party bears the initial burden of demonstrating that there is no genuine issue
of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). It may satisfy this burden
“in either of two ways: (1) by submitting evidence that negates an essential element of the nonmoving party’s claim, or (2) by demonstrating that the non-moving party’s evidence is insufficient
to establish an essential element of the non-moving party’s claim.” Nick’s Garage, Inc. v.
Progressive Cas. Ins. Co., 875 F.3d 107, 114 (2d Cir. 2017) (quoting Farid v. Smith, 850 F.2d 917,
924 (2d Cir. 1988)).
If the moving party satisfies its burden, “the opposing party must come forward with
specific evidence demonstrating the existence of a genuine dispute of material fact.” Brown v. Eli
Lilly & Co., 654 F.3d 347, 358 (2d Cir. 2011) (citing Anderson, 477 U.S. at 249). The opposing
party “‘must do more than simply show that there is some metaphysical doubt as to the material
facts’ and ‘may not rely on conclusory allegations or unsubstantiated speculation.’” Id. (first
quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); then quoting
FDIC v. Great American Ins. Co., 607 F.3d 288, 292 (2d Cir. 2010)). Nevertheless, “if there is any
evidence in the record from which a reasonable inference could be drawn in favor of the opposing
party that supports a finding that a material factual dispute exists, summary judgment is improper.”
United Rentals (N. America), Inc. v. Conti Enters., Inc., 293 F. Supp. 3d 447, 451 (S.D.N.Y. 2018)
(citing Gummo v. Village of Depew, 75 F.3d 98, 107 (2d Cir. 1996)).
6
B. Joint Employer Standard
The FLSA imposes liability on any “employer” who violates the FLSA’s overtime
provisions. Fernandez v. HR Parking Inc., 407 F. Supp. 3d 445, 450 (S.D.N.Y. 2019) (citing 29
U.S.C. § 216(b), (e)(2)). The FLSA defines “employer” as “any person acting directly or indirectly
in the interest of an employer in relation to an employee.” 29 U.S.C. § 203(d). An employer can
be “an individual, partnership, association, corporation, business trust, legal representative, or any
organized group of persons.” Id. § 203(a); see id. § 203(d). “An individual may simultaneously
have multiple employers for the purposes of the FLSA, in which event, all joint employers are
responsible, both individually and jointly, for compliance with all of the applicable provisions of
the FLSA.” Martin v. Sprint United Mgmt. Co., 273 F. Supp. 3d 404, 421 (S.D.N.Y. 2017)
(alteration and internal quotation marks omitted).
The Second Circuit has long observed that the FLSA is “written in the broadest possible
terms” to “have the widest possible impact in the national economy.” Carter v. Dutchess Cmty.
Coll., 735 F.2d 8, 12 (2d Cir. 1984); see also Falk v. Brennan, 414 U.S. 190, 195 (1973)
(emphasizing the “expansiveness” of the FLSA’s definition of employer). The “striking breadth”
of the FLSA’s definition of employer “‘stretches the meaning of “employee” to cover some parties
who might not qualify as such under a strict application of traditional agency law principles’ in
order to effectuate the remedial purposes of the [FLSA].” Barfield v. N.Y.C. Health & Hosps.
Corp., 537 F.3d 132, 141 (2d Cir. 2008) (first quoting Nationwide Mut. Ins. Co. v. Darden, 503
U.S. 318, 326 (1992); then collecting cases); accord Irizarry v. Catsimatidis, 722 F.3d 99, 104 (2d
Cir. 2013).
Given the expansive definition of “employer,” the Supreme Court “has instructed that the
determination of whether an employer-employee relationship exists for purposes of the FLSA
7
should be grounded in ‘economic reality rather than technical concepts.’” Barfield, 537 F.3d at
141 (quoting Goldberg v. Whitaker House Coop., Inc., 366 U.S. 28, 33 (1961)). “When it comes
to ‘employer’ status under the FLSA, control is key.” Lopez v. Acme American Envtl. Co., Inc.,
No. 12 Civ. 511 (WHP), 2012 WL 6062501, at *3 (S.D.N.Y. Dec. 6, 2012) (citing Herman v. RSR
Sec. Servs. Ltd., 172 F.3d 132, 135 (2d Cir. 1999)). To be held liable as an “employer” under the
FLSA, “an individual defendant must possess control over a company’s actual ‘operations’ in a
manner that relates to a plaintiff’s employment.” Irizarry, 722 F.3d at 109; see also Jeong Woo
Kim v. 511 E. 5TH St., LLC, 133 F. Supp. 3d 654, 665 (S.D.N.Y. 2015) (noting that “the overarching
concern is whether the alleged employer possessed the power to control the workers in question”
(quoting Moon v. Kwon, 248 F. Supp. 2d 201, 236 (S.D.N.Y. 2002))).
To determine the economic reality of a particular employment situation, the Second Circuit
has identified different sets of factors to consider based on factual circumstances posed by
particular cases. Barfield, 537 F.3d at 142. Two sets of factors, or tests, are relevant here: one
focuses on “formal control” and the other on “functional control.” Martin, 273 F. Supp. 3d at 422.
The formal control test asks “whether the alleged employer (1) had the power to hire and
fire the employees, (2) supervised and controlled employee work schedules or conditions of
employment, (3) determined the rate and method of payment, and (4) maintained employment
records.” Irizarry, 722 F.3d at 104–05 (quoting Barfield, 537 F.3d at 142); accord Herman, 172
F.3d at 139; Carter, 735 F.2d at 12. This test “is useful largely in cases involving claims of joint
employment,” Zheng v. Liberty Apparel Co., 355 F.3d 61, 67 (2d Cir. 2003) (quoting Danneskjold
v. Hausrath, 82 F.3d 37, 43 (2d Cir. 1996)), because it “bear[s] directly on whether workers who
are already employed by a primary employer are also employed by a second employer,” id. at 68;
accord Morgan v. MacDonald, 41 F.3d 1291, 1293 (9th Cir. 1994).
8
The Second Circuit has made clear that while satisfaction of the formal control factors “can
be sufficient to establish employment status,” it is not necessary. Barfield, 537 F.3d at 143 (quoting
Zheng, 355 F.3d at 69). Even if a putative joint employer did not exercise formal control, it may
nevertheless have exercised sufficient functional control over a worker to satisfy the FLSA
definition of employer. In re Domino’s Pizza Inc., No. 16-CV-2492 (AJN)(KNF), 2018 WL
4757944, at *7 (S.D.N.Y. Sept. 30, 2018) (quoting Zheng, 355 F.3d at 71)); see also, e.g., Gordon
v. Gen. Prop. Mgmt. Assocs., Inc., No. 19-cv-8107 (JGK), 2020 WL 6192818, at *6 (S.D.N.Y. Oct.
22, 2020) (noting that if “formal control does not exist, an entity may nonetheless exercise
sufficient functional control to be deemed an employer”).
The functional control test asks:
(1) whether [the putative employers’] premises and equipment were used
for the plaintiffs’ work; (2) whether the [subcontractors] had a business that
could or did shift as a unit from one putative joint employer to another;
(3) the extent to which plaintiffs performed a discrete line-job that was
integral to [the putative employers’] process of production; (4) whether
responsibility under the contracts could pass from one subcontractor to
another without material changes; (5) the degree to which the [the putative
employers] or their agents supervised plaintiffs’ work; and (6) whether
plaintiffs worked exclusively or predominantly for the [the putative
employers].
Zheng, 355 F.3d at 72 (citing Rutherford Food Corp. v. McComb, 331 U.S. 722, 724–25 (1947));
accord Martin, 273 F. Supp. 3d at 422. The functional control test is “most relevant in the context
of subcontractor relationships.” Fernandez, 407 F. Supp. 3d at 451 (quoting Granda v. Trujillo,
No. 18 Civ. 3949 (PAE), 2019 WL 367983, at *5 (S.D.N.Y. Jan. 30, 2019)); see Greenawalt v. AT
& T Mobility LLC, 642 F. App’x 36, 37–38 (2d Cir. 2016) (summary order).
Several courts in this circuit have recognized that “[t]he definition of employer and analysis
for determining whether an employer/employee relationship exists under the NYLL are parallel to
that of the FLSA.” Fernandez v. Kinray, Inc., 406 F. Supp. 3d 256, 261 n.3 (E.D.N.Y. 2018)
9
(collecting sources). “To be sure, the New York Court of Appeals has not yet resolved whether the
NYLL’s standard for employer status is coextensive with the FLSA’s, but there is no case law to
the contrary.” Hart v. Rick’s Cabaret Int’l, Inc., 967 F. Supp. 2d 901, 940 (S.D.N.Y. 2013) (citing
Irizarry, 722 F.3d at 117). As such, courts routinely apply the same tests to determine whether
individuals or entities are joint employers under the FLSA and NYLL. See Monzano-Moreno v.
Libqual Fence Co., Inc., No. CV 18-0161 (MKB) (AKT), 2021 WL 730663, at *10 (E.D.N.Y. Feb.
5, 2021) (collecting cases); Benzinger v. Lukoil Pan Americas, LLC, 447 F. Supp. 3d 99, 132 n.19
(S.D.N.Y. 2020) (collecting cases); Fernandez, 407 F. Supp. 3d at 452 (collecting cases); Martin,
273 F. Supp. 3d at 422 (collecting cases).
The formal and functional control tests “state no rigid rule for the identification of an FLSA
employer.” Barfield, 537 F.3d at 141. Rather, “they provide ‘a nonexclusive and overlapping set
of factors’ to ensure that the economic realities test mandated by the Supreme Court is sufficiently
comprehensive and flexible to give proper effect to the broad language of the FLSA.” Id. (quoting
Zheng, 355 F.3d at 75–76). Employment for FLSA purposes must ultimately “be determined on a
case-by-case basis by review of the totality of the circumstances.” Irizarry, 722 F.3d at 104.
“The question of whether a defendant is an employer under the FLSA is a mixed question
of law and fact, with the existence and degree of each relevant factor lending itself to factual
determinations.” Berrios v. Nicholas Zito Racing Stable, Inc., 849 F. Supp. 2d 372, 393 (E.D.N.Y.
2012) (citing Franco v. Ideal Mortg. Bankers, Ltd., No. 07 Civ. 3956, 2011 WL 317971, at *6
(E.D.N.Y. Jan. 28, 2011); and Ansoumana v. Gristede’s Operating Corp., 255 F. Supp. 2d 184, 190
(S.D.N.Y. 2003)). Because a determination of joint employment is inherently “‘fact-intensive,’
awards of summary judgment on this issue, although sometimes appropriate, are rare.”
Greenawalt, 642 F. App’x at 37 (citing Barfield, 537 F.3d at 143–44); see also Quintanilla v.
10
Suffolk Paving Corp., No. CV 09-5331 (AKT), 2019 WL 885933, at *17 (E.D.N.Y. Feb. 22, 2019);
Short v. Churchill Benefit Corp., No. 14-CV-4561 (MKB), 2016 WL 8711349, at *17 (E.D.N.Y.
Apr. 8, 2016); Hart, 967 F. Supp. 2d at 941. 2
DISCUSSION
A. Formal Control
In determining whether the PZ Defendants are employers of the Plaintiffs under the FLSA,
the Court begins by examining the four formal control factors.
1. Hiring and Firing
Under the first factor, the Court considers whether the PZ Defendants had the power to hire
and fire Plaintiffs. Irizarry, 722 F.3d at 104–05. The PZ Defendants submit that they did not have
such power. (Defs.’ 56.1 ¶ 33.)
As to hiring, Plaintiffs concede that the PZ Defendants did not interview or hire any
Atlantic workers. (Pls.’ 56.1 ¶ 33.) Plaintiffs also concede that when Atlantic employees first
arrived at the Jardim Project, they would meet with an Atlantic foreman who would discuss the
nature of the work, scheduling, and pay rates. (Pls.’ 56.1 ¶¶ 42–43.)
Plaintiffs seek to make an issue of the fact that the PZ Defendants directed Miranda, an
Atlantic foreman, to hire additional workers and ultimately approved the hiring of new workers.
(Pls.’ 56.1 ¶ 47.) They point to Miranda’s deposition testimony that, as a foreman, he would hire
2
In their briefs, the PZ Defendants cited and relied on a 2020 rule promulgated by the Department of Labor, see
85 Fed. Reg. 2820 (Jan. 16, 2020), codified at 29 C.F.R. §§ 791.1–3, that “narrow[ed] the definition of joint
employment under the FLSA,” New York v. Scalia, No. 1:20-cv-1689-GHW, 2020 WL 5370871, at *1 (S.D.N.Y.
Sept. 8, 2020). In Scalia, the court vacated this rule, holding that it violated the Administrative Procedure Act. Id. at
*1, *34. That decision is currently on appeal before the Second Circuit. New York v. Scalia, Nos. 20-3806, 20-3815
(2d Cir. appeal docketed Nov. 6, 2020). The PZ Defendants contend that the Scalia decision should not impact the
merits of the PZ Defendants’ arguments and that summary judgment is still proper even under the old rule. (Defs.’
Letter [ECF No. 113].) The Court concludes that under the old rule and under the new rule the PZ Defendants are not
entitled to summary judgment because there are genuine disputes of material fact. As such, the Court need not address
the impact of Scalia on the PZ Defendants’ arguments.
11
additional workers “but they would still have to go through [PZ’s] office first” and PZ “decide[d]
whether somebody was hired.” (Harrison Decl. Ex. G (“Miranda Tr.”) 34:23–35:9 [ECF No. 947].) This is not a genuine issue of material fact.
Simply approving new hires does not show sufficient control over the hiring process for
this factor to weigh in favor of joint employment. See Godlewska v. HDA, 916 F. Supp. 2d 246,
258 (E.D.N.Y. 2013) (finding that a city agency did not have power to hire because although it
“dictate[d] the minimum criteria for persons who fill these positions and reviews applicants’
resumes to ensure the applicants are qualified, [the contractor] alone decide[d] which qualified
applicants to hire”), aff’d sub nom. Godlewska v. Human Dev. Ass’n, Inc., 561 F. App’x 108 (2d
Cir. 2014) (summary order). More direct involvement in the hiring process is necessary for the
hiring factor to weigh in favor of formal control. See Herman, 172 F.3d at 140; Thomas v. River
Greene Constr. Grp. LLC, No. 17 Civ. 6954 (PAE), 2018 WL 6528493, at *7 (S.D.N.Y. Dec. 11,
2018) (alteration omitted) (rejecting argument that the hiring factor does not require defendant to
have “directly hired workers”); see also Morales v. Gourmet Heaven, Inc., No. 3:14-cv-01333
(VLB), 2016 WL 6996976, at *5 (D. Conn. Nov. 29, 2016) (finding that individual defendant
exercised formal control in part because “he personally hired all managers and supervisory staff”);
cf. Jean–Louis v. Metro. Cable Commc’n, Inc., 838 F. Supp. 2d 111, 123 (S.D.N.Y. 2011) (finding
that defendant did not have the power to hire where it did not receive applications from
subcontractor’s technicians, interview or review applicants, notify applicants that they had been
hired, or provide new hires with employment forms).
Plaintiffs also present evidence of several instances where the PZ Defendants directly and
indirectly “fired” Atlantic workers. (Pls.’ 56.1 ¶¶ 33, 49–54.) First, Maddedu (the PZ Senior
Project Manager) and Di’Nola (the PZ Project Engineer) directed Miranda to fire Gil because Gil
12
was “inefficient” and “didn’t want to do things the way [Maddedu] did things.” (Miranda Tr. 29:9–
30:13.) Second, there were “a couple of times” where the PZ Defendants ordered Miranda to
remove Atlantic employees from the Jardim Project, including once after Di’Nola observed
workers playing loud music and dancing on the job. (Harrison Decl. Ex. A (“Di’Nola 2019 Tr.”)
74:25–75:24 [ECF No. 94-1].) Third, a foreman was removed from the Jardim Project after
Maddedu sent an e-mail to Atlantic’s owner requesting that the foreman be removed because he
was “not following [Maddedu’s] directions by sending workers onsite without a logic” and “[t]he
results ha[d] not been satisfying.” (Harrison Decl. Ex. D (“Maddedu Tr.”) 44:3–46:6 [ECF No.
94-4].) Fourth, Di’Nola directed lead carpenter Darwin Aguirre to fire two specific individuals.
(Aguirre Decl. ¶ 27 (“I did not want to fire my co-workers, but I had to follow the orders of
[Di’Nola], because he—along with [Maddedu] and [Campoccia]—was in charge.”).) Fifth,
Di’Nola fired opt-in Plaintiff Misael Portillo because PZ was “cutting people.” (Portillo Decl.
¶¶ 27–30.) Finally, Di’Nola and Maddedu made lists of Atlantic workers to be fired when the
work slowed down and at least two workers on the list ultimately were fired. (Aguirre Decl. ¶¶ 25–
26.) 3
The PZ Defendants concede that there were times where, consistent with their “general
contractor obligations,” they requested that certain workers be removed from the job site for
creating safety risks or causing scheduling delays due to inadequate work. (Defs.’ 56.1 ¶¶ 49–51;
Defs.’ Br. 17–18; Reply 3–6.) In arguing that these actions do not amount to the power to fire, the
PZ Defendants rely on a line of cases where courts found that directing a subcontractor to remove
3
Aguirre states that Maddedu fired one of these employees, but as Defendants correctly note (Reply 5 n.5),
Aguirre relies on hearsay (see Aguirre Decl. ¶ 26 (“Mr.Vidal told me that [Maddedu] was the person who fired him.”)).
Because Plaintiffs have failed to show why this hearsay would otherwise be admissible at trial, the Court does not
consider this allegation. See Sarno v. Douglas Elliman–Gibbons & Ives, Inc., 183 F.3d 155, 160 (2d Cir. 1999);
Burlington Coat Factory Warehouse Corp. v. Esprit de Corp., 769 F.2d 919, 924 (2d Cir. 1985).
13
workers from a job site or de-authorizing a subcontractor’s workers from working on a specific
project did not establish the power to fire employees. See Vasto v. Credico (USA) LLC, No. 15
Civ. 9298 (PAE), 2017 WL 4877424, at *8–9 (S.D.N.Y. Oct. 27, 2017), aff’d, 767 F. App’x 54 (2d
Cir. 2019); Martin, 273 F. Supp. 3d at 423–25; Jean–Louis, 838 F. Supp. 2d at 123–125;
Godlewska, 916 F. Supp. 2d at 258. Central to each of these decisions, however, was the fact that
the defendants did not have the power to terminate the workers’ employment with the
subcontractor altogether or to prevent the worker from working for another company working on
the same project. See Vasto, 2017 WL 4877424, at *8–9 (noting that plaintiffs’ employer “was
permitted to work with other entities” and defendant’s “deactivation authority was not absolute”);
Martin, 273 F. Supp. 3d at 424–25 (“[T]ellingly, plaintiffs do not point to any evidence that Sprint
had the power to terminate a field agent’s employment at Wallace Morgan or ability to work on
any other Wallace Morgan campaign.”); Jean–Louis, 838 F. Supp. 2d at 124 (noting that the “Metro
technician whom Time Warner has prohibited from perform[ing] installation work while employed
by Metro may continue working for Metro in some other capacity . . . or leave Metro and later
perform installations while working as a technician for another company”); Godlewska, 916 F.
Supp. 2d at 258 (finding that although defendants could “direct [contractor] to remove the home
attendant from the particular patient’s case,” there was no evidence “that [defendants] ha[d] power,
let alone ever exercised power, to require [contractor] to fire a home attendant entirely”).
Here, Plaintiffs present evidence that Atlantic workers who were removed from the Jardim
Project were fired from Atlantic altogether. (Pls.’ 56.1 ¶ 33.) Atlantic workers were largely “hired
to work on the [Jardim Project] exclusively” and “never worked for Atlantic anywhere [else].”
(Aguirre Decl. ¶ 9; Juarez Decl. ¶ 6; Familia Decl. ¶ 6; Portillo Decl. ¶ 6; Sarabia Decl. ¶ 4.) For
example, Misael Portillo was fired by Di’Nola personally “because [the PZ Defendants] were
14
cutting people.” (Portillo Decl. ¶ 27.) When he was removed from the Jardim Project, he was
“fired from Atlantic” and “never worked for Atlantic again.” (Id. ¶¶ 30–31.) In other words,
Portillo’s removal from the Jardim Project by Di’Nola was a de facto firing. See Fernandez, 407
F. Supp. 3d at 452; see also Canh Le v. DirecTV, LLC, No. 2:16-cv-01369-SVW-AS, 2017 WL
6939087, at *1, *6 (C.D. Cal. Nov. 2, 2017) (finding that defendant had ability to “de facto fire”
or “constructively discharge [contractor’s laborer] by refusing to give him or her work”); Lemus v.
Timberland Apartments, L.L.C., No. 3:10–cv–01071–PK, 2011 WL 7069078, at *10 (D. Or. Dec.
21, 2011) (finding power to fire where developers retained “general right to remove
[subcontractor’s] employees from the job site for safety concerns, a sanction somewhat equivalent
to firing here where [developers’] jobs constituted the vast majority of [subcontractor’s] work”).
Moreover, other Plaintiffs were “fired” by Di’Nola or Maddedu once PZ contracted with another
company to complete the taping work. (Aguirre Decl. ¶¶ 34–37; Sarabia Decl. ¶¶ 23–27; Juarez
Decl. ¶¶ 23–25.) As the PZ Defendants note, these terminations are hardly “firings” in the
traditional sense. But the PZ Defendants fail to explain why they, not Atlantic, effectuated these
terminations. Viewed in the light most favor to Plaintiffs, the record permits a reasonable inference
that the PZ Defendants had and exercised the power to fire Atlantic employees.
The facts here are further distinguishable from the cases on which the PZ Defendants rely.
In Jean-Louis v. Metropolitan Cable Communications, Inc., 838 F. Supp. 2d at 125, for example,
the court held that Time Warner had no power to fire technicians of Metro, a cable installation
subcontractor, “but instead had the more limited power to de-authorize a technician.” In addition
to finding that a de-authorization was not a de facto firing, the court emphasized that there was no
evidence in the record that “Time Warner ever asked, let alone demanded, that Metro actually fire
any technician” or that “Metro terminated any employee about which Time Warner specifically
15
complained, never mind that Metro did so as a matter of course.” Id. at 125; see also Godlewska,
916 F. Supp. 2d at 258 (noting that defendants “never recommended to [the contractor] that a
specific home attendant be disciplined” (citing Jean-Louis, 838 F. Supp. 2d at 118)). Here,
conversely, there is evidence of several instances where the PZ Defendants directed supervisors to
fire Atlantic employees and the supervisors did in fact fire employees about which the PZ
Defendants specifically complained. (See Miranda Tr. 29:9–30:13; Di’Nola 2019 Tr. 74:25–75:24;
Maddedu Tr. 44:3–46:6; Aguirre Decl. ¶ 27.)
Accordingly, viewed the record in the light most favorable to Plaintiffs, there are triable
issues of fact with respect to the first formal control factor—the power to hire and fire.
2. Work Schedules and Conditions
Under the second factor, the Court considers whether the PZ Defendants supervised and
controlled Plaintiffs’ work schedules or conditions of employment. Irizarry, 722 F.3d at 104–05.
Extensive supervision is indicative of an employment relationship “only if it demonstrates
effective control of the terms and conditions of the plaintiff’s employment.” Zheng, 355 F.3d at
74–75 (citing Rutherford, 331 U.S. at 726, 730). Joint employer status may be found even where
supervision and control are “exercised only occasionally.” Herman, 172 F.3d at 139; see Barfield,
537 F.3d at 147 (noting that “the law does not require an employer ‘to look over his workers’
shoulders every day in order to exercise control’” (quoting Brock v. Superior Care, Inc., 840 F.2d
1054, 1060 (2d Cir. 1988))).
The facts relevant to this factor are largely disputed by the parties. The PZ Defendants
maintain that they “did not supervise or control Atlantic employee’s work schedules or their
conditions of employment.” (Defs.’ 56.1 ¶ 55; see also Defs.’ Br. 19–23; Reply 6–9; Campocca
16
Decl. ¶¶ 24–25).) But Plaintiffs present evidence to the contrary creating factual disputes that must
be tried. (See Pls.’ 56.1 ¶ 55.)
Plaintiffs present evidence that the PZ Defendants controlled Plaintiffs’ work schedules.
The record reflects that Di’Nola ordered Atlantic workers to work specific hours or work late under
threat of termination. (Portillo Decl. ¶¶ 10–11 (“[Di’Nola told me that I could be fired if I did not
work twelve (12) hours a day and did not work on Saturdays.”); Sarabia Decl. ¶ 9 (same); see also
Juarez Decl. ¶ 11; Familia Decl. ¶¶ 14–15.) More specifically, there is evidence that Di’Nola
ordered Plaintiffs to work until 7:00 p.m., under threat of being fired, even though Plaintiffs were
told by Atlantic when they were hired that they would work until 3:30 p.m. (Portillo Decl. ¶¶ 9–
10; Familia Decl. ¶¶ 11–14.) Plaintiffs allege that at times Di’Nola would direct certain workers
to stay past 7:00 p.m., while allowing others to leave. (Familia Decl. ¶¶ 18–20.) The record
reflects that Di’Nola also allowed specific employees to come in late as a reward for their good
work. (Sarabia Decl. ¶ 10.) It is also alleged that Di’Nola even required Atlantic workers to work
on Sunday. (Harrison Decl. Ex. B (“Di’Nola 2020 Tr.”) 26:12–28:25 [ECF No. 94-2].) Finally,
the record evidence reflects that the PZ Defendants directed the Atlantic foremen to assign
particular hours to the workers. (Miranda Tr. 104:12–104:17; Aguirre Decl. ¶¶ 17–18 (noting that
“[Di’Nola] would tell me what hours to have myself and the other carpenters work”).)
Plaintiffs also present evidence that the PZ Defendants controlled the Plaintiffs’ timesheets.
(See Di’Nola 2020 Tr. 15:12–15:24 (testifying that “I was the one keeping the sign-in sheets”);
Harrsion Decl. Ex. E. (“Hernandez Tr.”) 97:4–97:6 [ECF No. 94-5] (noting that “Di’Nola would
be in charge of [timesheets]”).) The record reflects that Di’Nola would monitor the timesheets and
often “call the roll” at the exit of the worksite as employees were leaving at the end of the day.
(Familia Decl. ¶¶ 18–20.) Di’Nola himself testified that he personally would sign out employees
17
at the end of the day. (See Di’Nola 2019 Tr. 103:15–107:9.) Atlantic workers sometimes contacted
Di’Nola directly over issues regarding their hours. (See Harrison Decl. Ex. I. at DEF1399–
DEF1401 [ECF No. 94-9].) Di’Nola admitted that at times he would sign Atlantic employees out
after they had left for the day as a “gratuity” or “tip” for their “good work.” (Di’Nola 2020 Tr.
11:2–12:6 (“[T]he cost difference between putting him at 6:00 and at 7:00 is very little among the
total, so I think it’s a good way to start the relation in a good way . . . .”).) Finally, when Atlantic
foremen or supervisors were sick or needed a day off, they would contact Di’Nola or Maddedu
personally. (See Aguirre Decl. ¶ 19 (stating that he had to ask Di’Nola if he needed a day off);
Di’Nola 2020 Tr. 17:21–18:14 (testifying that Miranda would advise him or Maddedu when he
would be absent); id. 39:19–40:16 (testifying that Mario Rodas, a “trusted worker,” had advised
him that he would be absent from work); Harrison Decl. Ex. I at DEF1384 (text message from
Miranda to Di’Nola: “I’m sick to my stomach I can’t go to work can you tell [Maddedu] please
Thanks.”); id. at DEF 1395 (text message from Miranda to Di’Nola: “I have the flu I don’t think
I’m going to work tomorrow”).)
Plaintiffs also present evidence that the PZ Defendants supervised conditions of
employment. The record reflects that Di’Nola directed Aguirre, as lead carpenter, to provide lists
of the Atlantic employees who were working, the location and floor of the building where they
were working, and the specific task each employee was assigned. (Aguirre Decl. ¶ 23; see id. Ex.
A; see also Di’Nola 2020 Tr. 63:25–64:18; id. 53:7–54:2 (testifying that Atlantic employees would
send him “list[s] of people that were working in a certain hour with understanding — because it
was for scheduling, basically and [Maddedu] wanted to understand who was a taper and who was
a carpenter”).) Di’Nola also told Aguirre “how to organize the work for the day, including which
workers (by name) [he] should have perform certain tasks.” (Aguirre Decl. ¶ 15; see also id. ¶ 24.)
18
Furthermore, Maddedu and Di’Nola would let Miranda know each day what “they wanted
to finish and what [he] had to do.” (Miranda Tr. 34:3–34:15.) At times, Di’Nola would walk the
worksite with Atlantic employees who were given supervisory authority to determine what needed
to be done. (Defs.’ Reply 56.1 ¶ 142; Di’Nola 2020 Tr. 56:24–57:19.) The PZ Defendants also
directed Miranda to assign specific tasks in specific locations to specific workers. (Miranda Tr.
63:13–63:25 (testifying that he “never made th[e] decision” where employees would work); see
also id. 38:5–38:8 (“Q. Of the Atlantic workers, would you ever decide what workers went on
what floor? A. According to [Di’Nola].”).) Text messages between Miranda and Di’Nola suggest
that Di’Nola closely monitored the status of Atlantic’s work. (See generally Harrison Decl. Ex. I
at DEF1383–DEF1398.)
Plaintiffs also present evidence that the PZ Defendants exerted direct control over Atlantic
employees. Newly hired employees of Atlantic were introduced to Di’Nola and told that he “was
in charge.” (Familia Decl. ¶¶ 4–5; Portillo Decl. ¶¶ 4–5; Aguirre ¶ 4; Juarez Decl. ¶¶ 4–5.) Indeed,
Di’Nola would advise new Atlantic employees that he was “the boss.” (Portillo Decl. ¶ 5; Juarez
Decl. ¶ 5.) Maddedu and Di’Nola personally would tell Atlantic employees where to work and
ask them to perform specific tasks. (Juarez Decl. ¶¶ 12–13; Portillo Decl. ¶ 13; Sarabia Decl.
¶¶ 12–13.) Di’Nola, albeit in jest, discussed using soccer cards to signal to Atlantic workers
consequences for poor work: first yellow card – one hour unpaid; second yellow card – a half day
unpaid; first red card – one day unpaid; and second red card – go home. (Di’Nola 2020 Tr. 12:18–
15:10; Harrison Decl. Ex. I at DEF1384.)
Plaintiffs’ evidence creates genuine issues of material fact with respect to whether the PZ
Defendants supervised and controlled Plaintiffs’ work schedules and employment conditions. The
record here distinguishes this case from those on which the PZ Defendants rely where courts
19
granted summary judgment and found that the putative joint employer did not control work
schedules. Cf. Jean-Louis, 838 F. Supp. 2d at 126 (finding that Time Warner did not control work
schedules where it was “undisputed that Metro tells its technicians when to report in the morning;
that technicians contact Metro if they are running late or will be absent; and that no Plaintiff ever
contacted Time Warner about those issues”). Defendants rely heavily on Martin (Defs.’ Br. 20–
21); but the degree of control over employee work schedules here is in stark contrast to that in
Martin. 273 F. Supp. 3d at 425 (finding that defendant did not control work schedules where
employees were assigned to particular locations by defendant’s subcontractor, notified
subcontractor when they were sick or would otherwise miss work, and never spoke to defendant
about their jobs, duties, or work hours).
Defendants also rely on Hugee v. SJC Grp., Inc., No. 13 Civ. 0423(GBD), 2013 WL
4399226, at *5 (S.D.N.Y. Aug. 14, 2013). (Defs.’ Br. 22–23.) There, the court found that a security
agency was not a joint employer of a subcontractor’s security guard even though the security guard
reported to the agency each day upon his arrival to and departure from the worksite and filled out
the agency’s timesheets. Id. at *5. In granting the security agency’s motion to dismiss, the court
also noted that the security guard received “day-to-day instruction about assignments or
scheduling” by the subcontractor. Id. Here, conversely, there is evidence that, in addition to
requiring Plaintiffs to sign in and out each day and monitoring the timesheets, the PZ Defendants
ordered Atlantic workers to work specific hours and stay late under threat of being fired; permitted
specific workers to come in late; required employees to work on Sunday; directed Atlantic to assign
certain hours to workers; altered the timesheets; were notified of absences directly by workers;
and exerted control over daily assignments. Put simply, the allegations in Hugee do not compare
to the evidence Plaintiffs have marshaled.
20
The PZ Defendants argue that they “merely exercise[d] oversight to ensure compliance
with safety and security regulations, or to ensure that [the] subcontractor’s work was carried out
for quality assurance purposes.” (Defs.’ Br. 19.) The Second Circuit has cautioned courts not to
misinterpret this factor to “encompass run-of-the-mill subcontracting relationships,” Zheng, 355
F.3d at 74, explaining that “supervision with respect to contractual warranties of quality and time
of delivery has no bearing on the joint employment inquiry, as such supervision is perfectly
consistent with a typical, legitimate subcontracting arrangement,” id. at 75 (citing Moreau v. Air
France, 343 F.3d 1179, 1188 (9th Cir. 2003), superseded by 356 F.3d 942 (9th Cir. 2004)). In
assessing supervision in contracting and subcontracting arrangements, courts distinguish between
“circumstances where the putative joint employer maintains specific standards to which its
contractors and the contractors’ employees must adhere, and regularly monitors the contractor’s
employees to ensure that their performance satisfies the putative joint employer’s expectations,”
which alone does not establish control of work conditions, and “circumstances where the putative
joint employer is responsible for the day-to-day management of the contractor’s employees.”
Vasto, 2017 WL 4877424, at *10 (alterations, ellipsis, and internal quotation marks omitted)
(quoting Lawrence v. Adderley Indus, Inc., No. 09 Civ. 2309 (SJF) (ETB), 2011 WL 666304, at *9
(E.D.N.Y. 2011)).
Here, drawing reasonable inferences in Plaintiffs’ favor, the record suggests a level of
supervision beyond mere quality control and monitoring project completion time and akin to dayto-day management of Atlantic laborers. There is record evidence suggesting that the PZ
Defendants monitored Atlantic workers on a daily basis, directed Atlantic foremen to assign
specific tasks to particular workers, and personally told Atlantic employees where to work and
what tasks to perform. See Antenor v. D & S Farms, 88 F.3d 925, 935 (11th Cir. 1996) (alteration
21
omitted) (noting that “it is well settled that supervision is present whether orders are communicated
directly to the laborer or indirectly through the contractor” (quoting Aimable v. Long & Scott
Farms, Inc., 20 F.3d 434, 441 (11th Cir. 1994))); see also Greenawalt, 642 F. App’x at 39–40
(reversing grant of summary judgment and finding that supervision factor did not weigh against
joint employment where “plaintiffs’ day-to-day work was supervised mostly by [putative joint
employer’s] store managers”).
The Court recognizes, as the PZ Defendants argue (Defs.’ Br. 19; Reply 6), that general
contractors may oversee the work of subcontractors to ensure work is satisfactory and to keep the
project on schedule. Zheng, 355 F.3d at 74–75. But there are limits. In the context of contractor
and subcontractor relationships, factual disputes concerning a putative joint employer’s degree of
supervision over employment conditions and control over scheduling precludes a finding that, as
a matter of law, this factor weighs against joint employment. See Murillo v. Coryell Cty.
Tradesmen, LLC, No. 15-3641, 2017 WL 2780750, at *10 (E.D. La. June 27, 2017) (finding
genuine issue of material fact over whether contractor controlled schedules and supervised
conditions of subcontractor’s employees given evidence that contractor determined what work
would be done, had authority to order employees to stop working, and monitored employees on
the job and when signing in and out); Reinoso v. A G C Consulting Civil Eng’rs, NO. 12-23461CIV, 2015 WL 12533085, at *5–6 (S.D. Fla. Oct. 7, 2015) (finding factual disputes regarding
supervision where “[contractor’s] representatives directly instructed [plaintiffs]” and “played a
role in recording the time they worked,” rejecting argument that contractor “merely . . . provided
general instructions or checked quality”); Chao v. Westside Drywall, Inc., 709 F. Supp. 2d 1037,
1062–63 (D. Or. 2010) (finding that supervision and control factor weighed in favor of joint
employment where defendants controlled which project sites contractor’s work crews were
22
assigned to and required laborers to track their work on sheets provided by defendants, even though
defendants did not tell laborers when to report to work, when their workday ended, or what days
to work).
Accordingly, given the genuine factual disputes and drawing all reasonable inferences in
Plaintiffs’ favor, a jury could reasonably find that the second formal control factor—supervision
and control over work schedules and employment conditions—supports a finding of joint
employment.
3. Rates and Methods of Payment
Under the third factor, the Court considers whether the PZ Defendants determined
Plaintiffs’ rate and method of payment. Irizarry, 722 F.3d at 104–05. “[T]he test is whether a
putative joint employer determines pay rates, not whether it affects them.” Jean–Louis, 838 F.
Supp. 2d at 129–30.
It is undisputed that the PZ Defendants did not exercise control over the method of
payment. On a weekly basis, Atlantic’s owners would come to the worksite and distribute
envelopes with checks or cash to Atlantic employees. (Pls.’ 56.1 ¶¶ 128–29.) No Atlantic
employee received a check or cash from PZ. (Pls.’ 56.1 ¶ 130.)
With respect to the rates of payment, it is undisputed that pursuant to the PZ-Atlantic
contract, PZ was required to pay Atlantic $30 per hour for all labor supplied. (Pls.’ 56.1 ¶ 20.)
Atlantic submitted invoices supported by the timesheets showing how much each employee
worked. (Pls.’ 56.1 ¶ 122.) When reviewing the invoices, PZ consulted the timesheets to ensure
that the invoices accurately captured the number of hours worked. (Pls.’ 56.1 ¶ 123.) PZ issued
back charges if Atlantic needed to redo work or fell behind schedule, but the PZ Defendants did
not direct Atlantic to deduct hours from Plaintiffs’ pay for such back charges. (Pls.’ 56.1 ¶ 125.)
23
Plaintiffs argue that the PZ Defendants controlled the rate of payments by refusing to pay
Atlantic for some hours its employees worked and by capping payment to Atlantic for labor at $30
per hour. (Opp. 13.) Evidence in the record suggests that Di’Nola declined to approve certain
hours of particular Atlantic employees, thereby depriving them from receiving payment from
Atlantic for those hours. (See Miranda Tr. 40:11–41:17 (testifying that Di’Nola “would decide to
take hours out” if an employee “didn’t do his job well” causing Atlantic not to pay the employee
for the hours worked); id. 86:22–87:7 (“[Di’Nola] would take hours from the total.”).) Indeed,
some Plaintiffs maintain that they did not receive pay for all the hours that they worked (Sarabia
¶ 21; Juarez Decl. ¶ 21), though it is unclear whether this was caused by Di’Nola’s deductions.
In Barfield v. New York City Health and Hospitals Corp., 537 F.3d at 144–45, the Second
Circuit recognized that a putative joint employer that pays a contractor based on the number of
hours the contractor’s employees work may ultimately determine the amount of payment the
employees receive from the contractor. Accord Jean-Louis, 838 F. Supp. 2d at 129. In Barfield,
the court found that a hospital that calculated nurses’ hours and paid referral agencies based on the
calculations exerted control over the nurses’ pay. 537 F.3d at 144. The court explained that the
hospital’s “calculations conclusively determined the number of hours for which [the nurses] would
be paid.” Id. The court recognized that “the hourly rate [the hospital] paid the referral agencies
effectively set a cap on the hourly rate that the agencies would pay [nurses].” Id. at 144–45.
This case is on all fours with Barfield. PZ calculated the number of hours Atlantic
employees worked and paid Atlantic based on those calculations.
Atlantic then used the
calculations to pay its employees. Cf. Jean-Louis, 838 F. Supp. 2d at 129–30. The evidence
supports an inference that PZ’s calculations conclusively determined the pay received by Atlantic
employees. In addition, the $30-per-hour rate that PZ paid Atlantic for all labor ultimately set a
24
cap on how much Atlantic could pay its laborers. See Fernandez, 407 F. Supp. at 455. In these
circumstances, the third factor is typically “inconclusive.” Barfield, 537 F.3d at 145; Fernandez,
407 F. Supp. at 455.
Accordingly, viewed in the light most favorable to Plaintiffs, the third factor—rates and
methods of payment—is inconclusive and thus does not decisively weigh against joint
employment.
4. Maintenance of Employment Records
Under the fourth factor, the Court considers whether the PZ Defendants maintained
Plaintiffs’ employment records. Irizarry, 722 F.3d at 104–05. The “employment records on the
matter most relevant to overtime obligations under the FLSA” are those relating to “hours
worked.” Barfield, 537 F.3d at 144. Evidence in the record reflects that PZ maintained time
records for Atlantic employees who worked on the Jardim Project. (Di’Nola 2019 Tr. 60:11–61:6
(testifying that he maintained copies of Atlantic employees’ timesheets during the Jardim Project
through the commencement of this action); see also Di’Nola 2020 Tr. 15:22–15:24.)
Here, the record reflects that the PZ Defendants “sign[ed] off on” plaintiffs’ timesheets,
“verif[ied] the number of hours worked,” and “provide[d] records of the hours worked” to Atlantic,
which used the records to compensate Plaintiffs on a per-hour basis—the same situation in Barfield
where there was “no question” that this factor weighed in favor of joint employment. 537 F.3d at
136, 144; see Westside Drywall, 709 F. Supp. 2d at 1063 (finding that maintenance of records
weighed in favor of joint employment given “evidence that Defendants required the claimants to
track their work on time sheet worksheets, and that the claimants were required to turn these
documents in to [the putative joint employer]”); see also Lemus, 2011 WL 7069078, at *15 (“By
collecting the equivalent of JC Builders’ payroll information and tracking how many workers it
25
had on the job, Polygon differentiated itself from a typical general contractor, who has no access
to subcontractor employment records.”); cf. Jean-Louis, 838 F. Supp. 2d at 130.
Accordingly, viewed in the light most favorable to Plaintiffs, a jury could reasonably find
that the fourth formal control factor—maintenance of employment records—supports a finding of
joint employment.
*
*
*
Considering the four formal control factors, the PZ Defendants have failed to meet their
burden to prevail on summary judgment. The record is riddled with genuine disputes of material
fact that bear directly on the formal control analysis, precluding a finding that the PZ Defendants
did not exercise formal control over Plaintiffs. Cf. Vasto, 2017 WL 4877424, at *12 (finding no
formal control by putative joint employer where first, second, and fourth factors weighed against
finding of joint employment while third factor was inconclusive); Godlewska, 916 F. Supp. 2d at
262 (same). 4
B. Functional Control
Even if there were no factual disputes with respect to the formal control test and the PZ
Defendants demonstrated that, as a matter of law, they did not exercise formal control over
Plaintiffs, that is not the end of the analysis. To be entitled to judgment as a matter of law, the PZ
Defendants must demonstrate that they “neither formally nor functionally controlled” Plaintiffs—
i.e., that they were not employers under the formal control test and the functional control test.
Vasto, 2017 WL 4877424, at *16; Martin, 273 F. Supp. 3d at 434, 439; see Zheng, 355 F.3d at 69
4
Separate from their primary, general arguments, the PZ Defendants briefly argue that Di’Nola and Campoccia
should not be deemed employers. (Defs.’ Br. 24.) Based on the Court’s review of the record, the evidence concerning
Campoccia appears to be limited. The PZ Defendants, as the movants who bear the burden to show that they are
entitled to summary judgment, did not attempt to differentiate clearly Campoccia from PZ and Di’Nola. The Court
declines to do so here. In any event, as discussed below, even if the Court found that Campoccia did not exercise
formal control, summary judgment would not be appropriate. See infra Discussion, Section B.
26
(noting that the FLSA “demands that a district court look beyond an entity’s formal right to control
the physical performance of another’s work before declaring that the entity is not an employer
under the FLSA”). Despite relying on several cases that make this point plain, the PZ Defendants
did not brief the functional control test or otherwise attempt to show that they did not exercise
functional control over Plaintiffs. (See generally Defs.’ Br.; Reply; Defs.’ 56.1.) Accordingly, as
the moving party, they have necessarily failed to meet their burden and therefore cannot be entitled
to summary judgment. See Sigmon v. Parker Chapin Flattau & Klimpl, 901 F. Supp. 667, 679
(S.D.N.Y. 1995) (“[B]ecause the parties did not brief the issue, and because the burden is on the
movant at summary judgment, the Court denies defendant’s motion with regard to the state
claim.”); see also Bloom v. Town of Stratford, No. 3:05cv217 (PCD), 2006 WL 3388396, at *9 (D.
Conn. Nov. 16, 2006) (“Defendants do not specifically brief this issue and therefore, summary
judgment will not be entered . . . .”).
The PZ Defendants rely heavily on Matter of Ovadia v. Office of the Industrial Board of
Appeals, 19 N.Y.3d 138, 143–45, 969 N.E.2d 202, 946 N.Y.S.2d 86 (2012), in the context of formal
control. While Ovadia concerned the functional control test, the point the PZ Defendants seek to
make about the potential impact on the construction industry bears comment. In Ovadia, the New
York Court of Appeals disapproved of the application of a couple of the functional control factors
to a construction-related contractor-subcontractor relationship. 19 N.Y.3d at 143–45. Specifically,
the court noted that consistent application of certain considerations “in the construction realm[]
would likely render most general contractors the joint employers of their subcontractors’
employees—a proposition that does not reflect the actual relationships in the construction
industry.” Id. at 144. Yet Ovadia explicitly cautioned that its “holding should not be misconstrued
27
as a conclusion that a general contractor in a construction setting can never be an employer of its
subcontractor’s employees.” 19 N.Y.3d at 145.
The PZ Defendants contend that finding joint employment in this case “would turn the
construction industry on its head and dramatically increase the liability of general contractors in
the construction industry.”
(Defs.’ Br. 2.)
“That the general contractor-subcontractor
relationship . . . remains prevalent in the relevant industry has no bearing on whether entities
codetermine the essential terms and conditions of a worker’s employment and, therefore, constitute
joint employers for purposes of the FLSA.” Salinas v. Commercial Interiors, Inc., 848 F.3d 125,
143–44 (4th Cir. 2017). As the Second Circuit has explained, “the prevalence of an industry-wide
custom is subject to conflicting inferences. While, on the one hand, it may be ‘unlikely’ that a
prevalent action is ‘a mere subterfuge to avoid complying with labor laws,’ on the other hand, the
very prevalence of a custom may ‘be attributable to widespread evasion of labor laws.’” Barfield,
537 F.3d at 146 (quoting Zheng, 355 F.3d at 73–74).
In any event, the PZ Defendants’ concerns are unfounded.
Joint employment is
“determined on a case-by-case basis by review of the totality of the circumstances.” Irizarry, 722
F.3d at 104. In the construction industry, or any other industry, where “a general contractor
contracts work out to a subcontractor that directly employs workers, the general contractor will
face no FLSA liability so long as it . . . disassociates itself from the subcontractor with regard to
the key terms and conditions of the workers’ employment.” Salinas, 848 F.3d at 149 (citing Reyes
v. Remington Hybrid Seed Co., 495 F.3d 403, 409 (7th Cir. 2007)); see Zheng, 355 F.3d at 70, 72.
To make clear, the Court does not hold that the PZ Defendants were Plaintiffs’ employers.
Rather, the Court finds only that there are genuine issues of material fact that preclude summary
judgment on this issue.
28
CONCLUSION
For the reasons discussed above, the PZ Defendants’ motion for summary judgment is
DENIED. Plaintiffs shall file their anticipated motion for class certification, for certification of a
collective action, or both on or before April 13, 2021. (See Scheduling Order [ECF No. 77].)
The Clerk of Court is respectfully requested to terminate docket entry 87.
SO ORDERED.
_________________________________
_
________________ ______________
_ _ ___ __
____ __ ___ _ _
MARY KAY VYSKOCIL
Y KAY VYS
YSKOCIL
YS
CI
I
United States District Judge
d States District
is
Date: March 29, 2021
New York, NY
29
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