| Matter of Columbia Artists Mgt. LLC (Commissioner ofLabor) |
| 2013 NY Slip Op 06043 [109 AD3d 1055] |
| September 26, 2013 |
| Appellate Division, Third Department |
| In the Matter of Columbia Artists Management LLC,Appellant. Commissioner of Labor, Respondent. |
—[*1] Eric T. Schneiderman, Attorney General, New York City (Mary Hughes of counsel),for respondent.
Stein, J. Appeal from a decision of the Unemployment Insurance Appeal Board, filedFebruary 14, 2012, which assessed Columbia Artists Management LLC for additionalunemployment insurance contributions.
Columbia Artists Management LLC is a music management company that representsartists and musicians, and also arranges musical productions that go on tour to variousmusic venues. Columbia was audited by the Department of Labor for the period January2004 through December 2005 and assessed additional unemployment insurancecontributions on remuneration paid to certain individuals that Columbia considers to beindependent contractors. Following extended proceedings, the Unemployment InsuranceAppeal Board upheld the assessment of contributions with respect to two categories ofindividuals, namely, musicians who perform on tour at the musical productions arrangedby Columbia, and laborers (hereinafter referred to as loaders) who unload the truckstransporting the musical instruments and equipment to the musical venues where thetouring musicians are to perform. Columbia appeals the Board's decision and maintainsthat it is not liable for additional unemployment insurance contributions because themusicians and loaders are independent contractors.
By way of background, it is appropriate to examine the manner in which the on tourmusical productions at issue were arranged and operated. Initially, Columbiacollaborated with an independent musical director in deciding whether to launch an ontour musical production. [*2]The musical directordeveloped a theme or concept for the musical production and identified the desiredartists, while Columbia determined if there was a market for the production, identifiedpotential music venues and devised a budget. Once it was decided that the productionshould go forward, the musical director contacted the musicians and negotiated a rate ofpay that was satisfactory to Columbia based upon the projected budget. Columbia paidthe musicians weekly in accordance with written agreements it entered into with them foreach touring engagement. Columbia was responsible for selling the on tour production tothe music venues, circulating promotional materials and otherwise promoting the tour.
After entering into booking arrangements with the various music venues, Columbiaretained an independent trucking company to transport the instruments and equipment tobe used in the production. Due to the fact that the music venues at issue were unionized,a union representative made arrangements to have loaders unload the instruments andequipment from the truck to the sidewalk, at which point the unionized laborersemployed by the venue moved it inside. The union dealt directly with the loaders andinformed Columbia how many would be needed, as well as their rate of pay. Arepresentative from Columbia stood by while the truck was unloaded and gave theloaders their checks when the truck was empty.
With the foregoing in mind, we now consider the nature of the relationship betweenColumbia and the musicians and loaders. Preliminarily, we note that the existence of anemployer-employee relationship is a factual issue for the Board to decide and itsdetermination will be upheld if supported by substantial evidence (see Matter ofConcourse Ophthalmology Assoc. [Roberts], 60 NY2d 734, 736 [1983]; Matter of King's Brass Ceremonial[Commissioner of Labor], 75 AD3d 712, 713 [2010]). Generally, such arelationship will be found to exist where the employer exercises control over the resultsproduced or the means used to achieve those results, with the latter being more important(see Matter of Empire StateTowing & Recovery Assn., Inc. [Commissioner of Labor], 15 NY3d 433, 437[2010]; Matter of Rodriguez [2020 Video Voice Data, Ltd.—Commissioner ofLabor], 58 AD3d 929, 929-930 [2009]). However, "where the details of the workperformed are difficult to control because of considerations such as professional andethical responsibilities," the courts have applied the "overall control" test, which requiresthat the employer exercise control over important aspects of the services performed otherthan the results or means (Matter of Empire State Towing & Recovery Assn., Inc.[Commissioner of Labor], 15 NY3d at 437-438; see Matter of ConcourseOphthalmology Assoc. [Roberts], 60 NY2d at 736). Notably, this test has beenapplied to professional musicians who "do not easily lend themselves to directsupervision or control" (Matterof DeSantis [Commissioner of Labor], 54 AD3d 1103, 1104 [2008]; see Matter of Brevis Music Inc.[Commissioner of Labor], 54 AD3d 1084, 1085 [2008], lv denied 11NY3d 712 [2008]).
Turning first to the musicians, some aspects of their work support the conclusion thatthey are not employees, including that they were managed directly by the musicaldirector, who is independent of Columbia, supplied their own clothing and instruments,were free to work for competitors, were responsible for finding their own replacements ifunable to perform, were not provided with any fringe benefits and were designated asindependent contractors in their written contracts with Columbia. On the other hand,there are a number of factors that establish that Columbia retained control over importantaspects of the musicians' work. Specifically, Columbia paid the musicians a flat fee perweek for the duration of the tour as well as the costs of transportation, lodging andmiscellaneous expenses, supplied them with sheet music on occasion [*3]and prohibited them from taking on engagements thatconflicted with the tour. Most significantly, under the written contracts, Columbiaretained the right to ensure the artistic quality of the show by insisting that a performancebe changed if it found it to be inappropriate. In addition to retaining broad overall controlover the musicians' performances, Columbia retained the right to dismiss any musicianfor drug or alcohol abuse. In view of this, we conclude that substantial evidence supportsthe Board's finding of an employer-employee relationship between Columbia and themusicians, notwithstanding the evidence supporting a contrary result (see Matter ofDeSantis [Commissioner of Labor], 54 AD3d at 1104-1105; Matter of BrevisMusic Inc. [Commissioner of Labor], 54 AD3d at 1085-1086).
We reach a different conclusion, however, with respect to the loaders. There isnothing in the record to indicate that Columbia exerted any type of control over either themeans or the results of the work of these individuals. All communications involved inretaining the loaders occurred through the union representative at the venue, whodictated the terms of payment as well as the number of loaders needed. The Columbiarepresentative present at the time the trucks were unloaded was there solely for thepurpose of paying the loaders and provided no equipment or instruction to assist them inperforming their work. Accordingly, that part of the Board's decision finding theexistence of an employer-employee relationship between Columbia and the loaders is notsupported by substantial evidence (see Matter of Holleran [Jez Enters., Inc.—Commissioner ofLabor], 98 AD3d 757, 758-759 [2012]; Matter of Rodriguez [2020 VideoVoice Data, Ltd.—Commissioner of Labor], 58 AD3d at 930), and itsdecision must, therefore, be modified accordingly.
Rose, J.P., McCarthy and Garry, JJ., concur. Ordered that the decision is modified,without costs, by reversing so much thereof as assessed Columbia Artists ManagementLLC for additional unemployment insurance contributions based upon remuneration paidto loaders; matter remitted to the Unemployment Insurance Appeal Board for furtherproceedings not inconsistent with this Court's decision; and, as so modified, affirmed.