Roadies Denied Employee Status in Insurance Case

ALBANY, N.Y. (CN) - A music management company must carry unemployment insurance for touring musicians but not for the workers unloading instruments and equipment, a New York appeals court ruled.

Columbia Artists Management hired an independent trucking company to carry musicians' gear to and from performance venues. It viewed the musicians and loaders as independent contractors instead of employees. But the state Department of Labor determined that both groups were employees and asked Columbia to pay $7,600 in additional unemployment insurance on wages paid in 2004 and 2005.

In July 2010, an administrative judge sided with the company and overruled the department.

The agency then appealed to the state Unemployment Insurance Appeal Board, which in February 2012 found "credible evidence" that Columbia "exercised sufficient direction, supervision and control over the musicians and loaders to demonstrate an employment relationship."

The appeals court in Albany partially agreed Thursday, saying Columbia had enough control over the musicians' performances to be considered an employer.

While some aspects of the musicians' work supported the notion that they're contractors - including their designation as independent contractors in the contract - "there are a number of factors that establish that Columbia retained control over important aspects of the musicians' work," Justice Leslie Stein wrote for the New York Supreme Court's Appellate Division.

These included being paid a flat fee per week for the tour and having Columbia underwrite transportation, lodging and other expenses, the appeals court said.

More importantly, the court said, Columbia has the right ensure quality by firing musicians for drug or alcohol abuse if necessary.

"In view of this, we conclude that substantial evidence supports the board's finding of an employer-employee relationship between Columbia and the musicians, notwithstanding the evidence supporting a contrary result," the court ruled.

It came to a different conclusion regarding the loaders, however.

"There is nothing in the record to indicate that Columbia exerted any type of control over either the means or the results of the work of these individuals," Stein wrote.

"Due to the fact that the music venues at issue were unionized, a union representative made arrangements to have loaders unload the instruments and equipment from the truck to the sidewalk, at which point the unionized laborers employed by the venue moved it inside," the justices said.

The union representative decided how many laborers were needed for unloading and how much they would be paid, according to the court. A Columbia representative was also present, but only to pay the workers.

Because of the arrangement, "that part of the board's decision finding the existence of an employer-employee relationship between Columbia and the loaders is not supported by substantial evidence," the justices said.

Justices Robert Rose, William McCarthy and Elizabeth Garry concurred.

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