Page 63 - AAGLA 2020-11
P. 63

 Member Update
Should Your Onsite Manager Be Employed y You or Your Management Company?
a person along with that person’s primary employer.
Drinks all around if you guessed C.
Here’s another one – what does this have to do with apartment ownership and management? Well, in representing property owners and proper management companies, I have noticed a “tug of war” occurs regarding the employment of on-site managers. Should they be employees of the owner or of the management company?
Many property management companies insist these managers be deemed the owner’s employees – even when the owner employs no other people and the management company employs several. Each party typically demonstrates a reticence to claim the on-site managers as their own – likely based on the unspoken (but sometimes valid) recognition that on-site managers sometimes can be a source of headache and liability.1 But there exists an important practical and legal reality to keep in mind: it may not matter whose payroll the manager is on. When problems arise and it “all” hits the fan, a plaintiff’s lawyer, searching for deep pockets, may claim the on-site manager worked for both the owner and management company.
So now we come to the concept of a “joint” employer – the basic premise of which is that the plaintiff already is employed by one employer and seeks to establish that another also is responsible – typically for violating wage and hour requirements. To demonstrate how the law analyzes joint employer claims, let’s analyze a court decision called Curry v. Equilon Enterprises, LLC, which was decided a few
1 In fact, it is not uncommon for property owners to tell me they avoid buildings with 16 or more units so as to circumvent the problem altogether.
By Gary Ganchrow
hat is a “joint” employer in California? A. Someone who employs people in the cannabis industry; B. A rheumatologist office; C. A second business entity that is deemed to employ
years ago. I have chosen this case deliberately, as the facts bear significant parallels to a typical situation in which a property management company hires a resident manager. Please follow along.
The case involved a gas service station – including convenience store and carwash – owned by Shell Oil and leased to another company – which we will call the “Station Operator” – to operate. The Station Operator hired a manager who later sued Shell, claiming it also was his employer (in other words, a joint employer).
In analyzing the manager’s claim that Shell was her joint employer, the court explained that the level of control exercised by a company over the details of a worker’s work remains the main test to determine an employer-employee relationship; however, the following other factors may also come into play: (i) whether the worker is engaged in a distinct occupation or business, (ii) whether that kind of work usually is done with or without supervision, (iii) the skill required, (iv) who supplies the tools and place of work, (v) the length of time for which the services are to be performed, (vi) the method of payment (whether by time or by job), (vii) whether the work is part of the employer’s regular business, and (viii) whether the worker and company believe they are creating an employer-employee relationship.
I know these are kind of vague; this will make more sense when we see how the court applied these factors, so keep reading.
First, the court noted that the manager took directions from the Station Operator, not Shell; although Shell required the Station Operator to perform certain tasks, it did not require the manager to perform those tasks. One point for Shell. The Station Operator could hire who it wanted, and it alone determined what duties the manager should perform. Because Shell had no input on hiring or the manager’s job duties, so the court inferred Shell did not require the manager to possess any particular skill. Another point for Shell.

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