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Jaime Reyes v. District of Columbia Department of Employment Services

Jaime Reyes v. District of Columbia Department of Employment Services
No. 10-AA-1244 (D.C. Ct. App. July 12, 2012)
by Natalie Scurto, Summer Associate
Semmes, Bowen & Semmes (www.semmes.com)

In Reyes v. District of Columbia Department of Employment Services, the D.C. Court of Appeals overturned the Compensation Review Board’s (“CRB”) decision affirming the Administrative Law Judge’s (“ALJ”) denial of benefits to Plaintiff, Jaime Reyes, and remanded the case for further proceedings. The Court held that the ALJ’s findings were not supported by substantial evidence. The issue addressed by this Court is whether or not an employer/employee relationship existed between Reyes and MG Home Improvement.

In 2005, Reyes was hired by his brother-in-law, Manual Gonzalez, to work for MG Home Improvement (“MG Home”), a remodeling company owned and operated by Gonzalez. The injury at the heart of the matter occurred on June 1, 2007 while Reyes, along with other MG Home employees, was pouring a concrete floor at Gonzalez’s home. At the evidentiary hearing, Reyes testified that he performed numerous jobs as an employee of MG Home, including driving a company truck, pouring asphalt, installing plumbing and handling cement construction. Reyes added that he also performed other tasks for Gonzalez, for which he was not paid, including driving Gonzalez around, cutting grass and organizing tools in Gonzalez’s workshop. Gonzalez testified to similar facts. Furthermore, Gonzalez added that whenever there was work available, Gonzalez would pay Reyes weekly at a rate of $12.50 per hour. At the time of Reyes’ injury, business was slow, so Gonzalez offered Reyes and two (2) other employees work remodeling Gonzalez’ personal home. Each worker was paid by company check for the hours worked while remodeling Gonzalez’ home.

The ALJ concluded that Reyes and MG Home did not have an employer/employee relationship, holding that the work Reyes performed for MG Home was independent from the operation of MG Home’s usual business. Also, based on Reyes’ paychecks, the ALJ determined that Reyes’ work was not continuous or regular. The ALJ claimed that there was no way to determine the number of hours that Reyes worked for each paycheck. Additionally, the ALJ asserted Reyes’ claim failed because he was unable to prove that the time he worked compared with the work available during that period.

On appeal, the CRB applied a two-part test to determine the status of the relationship between Reyes and MG Home. The CRB found that although the ALJ did not fully address the first prong of the test, addressing the nature and character of the claimant’s work, Reyes failed to demonstrate that he had satisfied the second prong of the test, addressing the relationship of the claimant’s work to the purported employer’s business. The CRB acknowledged that the ALJ’s assertion that MG Home was a painting and drywall business only was in error, but because of Reyes’ inability to meet the second part of the test, it was merely harmless error.

The Court’s review of a final order of the CRB is not de novo. The Court looks to determine if the CRB’s determination is supported by substantial evidence, defined as “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Wiley v. District of Columbia Dep’t of Emp’t Servs., 984 A.2d 201, 204 (D.C. 2009). The CRB appropriately applied the “relative nature of the work” test to determine if an employer/employee relationship existed between Gonzalez and MG Home. Under this test, the nature of the claimant’s work and the relationship between the claimant’s work and the employer’s work are considered. Essentially, the test focuses on whether the worker is hired to do work in which the company specialized.

Judge Blackburne-Rigsby, writing for the majority, held that the CRB’s analysis under the “relative nature of the work” test was erroneous, as was their acceptance of the ALJ’s restrictive and incorrect factual analysis. Furthermore, the majority found neither of these errors to be harmless.

The Court, rejecting the ALJ and CRB’s assertions, found that evidence in the record clearly demonstrated that Reyes’ work was continuous and regular. Evidence showed that Reyes was paid $12.50 per hour for all of his work prior to the accident. Additionally, Reyes was employed for twenty-six (26) months, which constituted almost the entire lifespan of MG Home. During those twenty-six (26) months, Reyes received thirty-two (32) week’s worth of checks, including four (4) week’s worth of checks in the month leading up to the incident. Reyes was far from being a casual employee.

The Court also dismissed the ALJ’s assertion that for the employer/employee relationship to be established, Reyes must establish that his work compared to the work available during the time period. The employer/employee relationship is not dependent upon such a finding. Furthermore, the evidence in the record shows that Reyes did perform the work that was available at the time.

The D.C. Court of Appeals found that based upon the evidence in the record, the CRB and the ALJ’s decisions were, in fact, erroneous and not supported by the necessary substantial evidence. Testimony and other evidence demonstrated that Reyes did perform regular work related to MG Home’s purported business of remodeling homes, and therefore Reyes was an employee of MG Home. For these reasons, the D.C. Court of Appeals overturned the CRB’s order and remanded the case for further proceedings consistent with the holding that there was an employer/employee relationship existing between Reyes and MG Home.