Appeal from the Circuit Court of St. Clair County. No. 96-MR-532 Honorable Annette A. Eckert, Judge, presiding.
The opinion of the court was delivered by: Justice Maag
IN THE COURT OF APPEALS OF THE STATE OF ILLINOIS
Metro East Cab Co. v. Doherty, No. 5-97-0920 5th Dist. 1/21/99
Respondent, the Department of Employment Security (Department), assessed contributions, interest, and penalties that it claimed were due under the Unemployment Compensation Act (820 ILCS 405/205 (West 1992)) against petitioner, Metro East Cab Company, Inc. (Metro East). The assessment covered unpaid contributions for certain quarters in the years 1991, 1992, 1994, and 1995. The contributions were estimated using numbers from Metro East's 1993 dispatch sheets. The Department determined that cab drivers who leased vehicles from Metro East were performing services in employment for that company. The Department also decided that Metro East failed to prove that the drivers were independent contractors as defined in the Unemployment Compensation Act (820 ILCS 405/212 (West 1992)).
Metro East protested the assessment and the method by which the unpaid contributions were calculated. After a hearing, the Director of Employment Security (Director) affirmed the assessment and the amounts figured for unpaid contributions. Metro East then filed a complaint for administrative review in the circuit court of St. Clair County, Illinois. The circuit court affirmed the findings of the Director. Metro East filed this appeal challenging the circuit court's order and the Director's findings regarding the employment status of the drivers and the method by which the contributions were calculated.
The pertinent facts are as follows. Metro East Cab Company, Inc., is an Illinois corporation, owned and operated by Ronnie F. McCoy. During the relevant period, Metro East possessed a certificate of convenience and necessity issued by the city council of East St. Louis for the operation of taxicabs. Metro East owned 29 cars that it leased to taxicab drivers. Metro East employed one mechanic and five dispatchers. As of 1995, Metro East charged individual drivers a lease fee of $56 to lease a car for a 24-hour period. Metro Cab had increased its lease fee between 1990 and 1995 from $50 to $56 to cover increased operating costs, including insurance coverage. Metro East leased its vehicles for only 24-hour time periods. There were no 12-hour leases. All lease agreements were oral.
As part of the lease, each driver received a car equipped with a radio. Each driver was also offered the use of a "round the clock" dispatching service run by Metro East. Metro East provided the insurance coverage for all cars operating as taxicabs. Metro East provided oil for the vehicles and serviced them as necessary in order to ensure they were properly maintained. When a driver picked up a car, its gas tank was full. Drivers were required to return the vehicles with a full tank of gas. The drivers paid for their own gas. Metro East did not dictate where drivers purchased their gas. Metro East did not reimburse the drivers for gas they used. The drivers washed the cars when they deemed it necessary. The drivers were not reimbursed by Metro East for this expense.
Before Metro East would lease a cab to an individual, the individual was required to obtain a permit from the City of East St. Louis to operate a cab. Without this taxi permit, Metro East would not lease the car. Each driver was required to pay for the permit and all incidental expenses necessary to obtain it. Metro East did not reimburse the drivers for these expenses. Metro East did not require the drivers to complete any training before it would lease a vehicle to a driver. A new driver could make arrangements to ride with an experienced driver to learn the names of streets and the street layout in the area.
Metro East did not set fare schedules for the drivers. Fare schedules were set by the City of East St. Louis. The City of East St. Louis also had an ordinance that required taxi drivers to wear uniforms. Metro East had no such requirement. It did not provide uniforms for the drivers. They rented uniforms from a shop in East St. Louis. Drivers were required to pay for their own uniforms. Metro East did not reimburse the drivers for that expense. The City of East St. Louis also required all cars under a particular certificate to be of uniform color. In compliance with this ordinance, Metro East's cars displayed the name and telephone number of the company and were uniform in color.
As part of the lease fee, Metro East included a dispatch service. Drivers were given an opportunity to obtain passengers through Metro East's radio dispatch service but were not required to accept any call. Metro East did not sanction drivers for refusing to accept dispatched calls. Metro East did not keep a record of whether drivers actually picked up and transported dispatched passengers to their destinations or what fees were collected. Metro East did not keep any records documenting the number of dispatched passengers any particular driver accepted and transported.
Metro East did not receive any percentage of the driver's fares. There was no fee sharing. Metro East did not monitor the number of customers transported, the number of miles driven, or the amount of fares collected by the drivers. Each driver set his own schedule and worked as many hours as he chose. Metro East did not require the drivers to furnish a record of their hours or fares.
Metro East did not have any rules prohibiting the drivers from soliciting, obtaining, and maintaining their own contracts for cab services. Some drivers had personal customers. The drivers were not bound by any form of non-compete agreement and could work for other cab companies and transportation services both within and outside of East St. Louis. Drivers could pursue other types of employment. Some drivers engaged in other employment. Metro East did not assign routes to its drivers. It did not control or limit the territories in which each driver operated. Metro East did not furnish business cards, taxi stands, expense accounts, or other supplies to its drivers.
Metro East had one contract that it had negotiated with the Illinois Board of Education to transport "handicapped" children to and from school. The contract called for transportation of six to eight children during the regular school year. The Board of Education paid Metro East. Metro East offered to subcontract the transportation of these children to the drivers. If drivers declined to transport the children, the owner of Metro East transported them. Drivers were not required to transport these children and were not sanctioned for declining this work. If the drivers did accept the work, Metro East paid the drivers from the funds provided by the Board.
Metro East did not guarantee the services performed by drivers. It did not bond them. Metro East did not carry worker's compensation insurance on the drivers. It did not deduct social security tax from the drivers' income. Metro East did not keep records of the drivers' income. It did not report the drivers to the Internal Revenue Service and did not ...