The opinion of the court was delivered by: Richard J. Holwell, District Judge:
MEMORANDUM OPINION AND ORDER
In this action, Plaintiffs are current or former employees of defendant Metropolitan Cable Communications, Inc. ("Metro") who work as technicians installing telecommunications services provided to New York City residents by defendant Time Warner Cable of New York City ("Time Warner"). Purporting to represent a class of fellow Metro technicians, Plaintiffs allege that defendants-Metro, Metro executives, and Time Warner-did not pay them for overtime at the "time and a half" rates required by the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq. ("FLSA"). Time Warner has moved for summary judgment on the ground that the FLSA only applies to an "employer" and there is no genuine issue of material fact precluding the Court from determining as a matter of law that Time Warner was not Plaintiffs' employer. For the following reasons, the Court agrees and grants Time Warner's motion.
Time Warner provides cable services to over one million subscribers in the New York City area. (See Pl.'s 56.1 Stat. ¶ 1.) To install cable for these subscribers, Time Warner contracts with Metro and two other companies, Uptown Communications & Electric ("Uptown"), and Broadband Express, neither of whom is a party to this action. (See Pl.'s 56.1 Stat. ¶ 2.) During the time period relevant to this action, Metro contracted only with Time Warner. (See Pl.'s 56.1 Stat. ¶ 4.)
Metro, not Time Warner, hires technicians to perform installations at
Time Warner customers' homes. (See Pl.'s 56.1 Stat. ¶ 2.)*fn1
Prospective technicians apply directly to Metro, interview
with Metro personnel at Metro's facility, hear from Metro personnel
that they have been hired, and receive paperwork from Metro. (See
Pl.'s 56.1 Stat. ¶¶ 15-18.) None of the Plaintiffs met or communicated
with anyone from Time Warner prior to being hired by Metro. (See Pl.'s
56.1 Stat. ¶ 19.) Time Warner requires Metro to conduct criminal
background checks on prospective technicians, but it does not require
Metro to provide the results of those checks. (Pl.'s 56.1 Stat. ¶ 158;
Dec. of S. Silverman, Nov. 8, 2010 ("Silverman Dec.") Ex. 41 at 95.)
In fact, Metro is not even required to inform Time Warner when it
hires a technician. Metro assigns each technician a number and
approximately every six months provides Time Warner with a list of
technicians and their numbers. (See Def.'s 56.1 Stat. ¶ 13; Pl.'s 56.1
Stat. ¶ 103.)
When Metro hires a technician, the relationship between Metro and the technician is governed by a collective bargaining agreement ("CBA") between Metro and Local 3,International Brotherhood of Electrical Workers ("Local 3"). (See Defs.' 56.1 Stat. ¶ 35; Pl.'s 56.1 Stat. ¶ 35.) Among other things, the CBA provides for a 40 hour work week; specifies pay rates for work during that regular week; provides for "time and a half" rates for overtime and work on holidays and double rates for work on Sundays; regulates vacation periods as well as personal, sick and bereavement days; and provides for pension fund contributions. (See Pl.'s 56.1 Stat. ¶ 37.) Time Warner is not a party to the CBA and did not participate in negotiating it. (See Pl.'s 56.1 Stat. ¶ 36.)
Metro equips new technicians with radios; a set of the tools that Time Warner has indicated are necessary to perform installation work; uniforms that display the Metro logo; and, in some cases, trucks with Metro logos that reside at Metro's facility. (See Pl.'s 56.1 Stat. ¶¶ 48, 50, 59, 65-68.) Metro also provides technicians with a Metro identification card. (See Pl.'s 56.1 Stat. ¶ 61.) Time Warner's agreement with Metro requires Metro technicians to report to Time Warner's facility to obtain an additional identification card that contains the words "Contractor," "Metropolitan," and "Time Warner." (See Pl.'s 56.1 Stat. ¶ 64.)*fn2 Metro technicians do not visit Time Warner's facility for any other reason. And Time Warner provides only (a) the cable boxes and other similar devices that Metro technicians connect in customers' homes and (b) so-called "lock box keys" that provide access to cable connections in the field. (See Pl.'s 56.1 Stat. ¶¶ 53-57.)
New technicians train by shadowing Metro personnel in the field. (See Pl.'s 56.1 Stat. ¶¶ 42-44.) Technicians also attend periodic training sessions regarding new products and work specifications. (See Pl.'s 56.1 Stat. ¶¶ 42-44.) There is evidence that Time Warner personnel attended and provided documents used at some of these training sessions, in particular a session regarding customer relations. However, the parties dispute the extent to which Time Warner personnel train Metro technicians. On the other hand, there is documentary evidence that Time Warner sends Metro so-called "Tech Tips" and other communications containing installation specifications, and Plaintiffs testified that Metro distributed similar communications to Metro technicians. (See Dec. of R. Asher, Dec. 22, 2010 ("Asher Dec.") Ex. 2 at 31; id. Exs. 44-48; Pl.'s 56.1 Stat. ¶ 126.)
Metro technicians report to work at Metro's facility at times specified by Metro managers and are required to contact Metro managers if they will be late or absent. (See Pl.'s 56.1 Stat. ¶¶ 70, 71.) None of the Plaintiffs has ever contacted Time Warner for that reason. (See Pl.'s 56.1 Stat. ¶ 72.) By the time that technicians arrive at work, Time Warner has provided Metro with 700-800 work orders based on installation requests from Time Warner customers. (See Pl.'s 56.1 Stat. ¶ 73.)*fn3 The work orders specify time windows of several hours in which Metro must perform the services the customer has requested. (See Pl.'s 56.1 Stat. ¶ 74.) However, the work orders do not contain any instructions as to how Metro should assign technicians to implement them. (See Pl.'s 56.1 Stat. ¶ 75.) Rather, Metro managers organize the work orders into routes and distribute them to technicians as they arrive. (See Pl.'s 56.1 Stat. ¶¶ 76-78.) On some occasions, several of the Plaintiffs did not receive a route if they arrived at work late. (See Silverman Dec. Ex. 48 at 136-37.)
Metro technicians normally perform their work alone. However, their work does require some communication with both Metro and Time Warner. Metro technicians sometimes call Metro foremen regarding technical issues or missing equipment. (See Pl.'s 56.1 Stat. ¶¶ 80, 81.) And Metro technicians contact Time Warner if they have difficulty installing a modem; if a customer asks to make changes to the Time Warner service he or she has ordered; if a customer is not at home; or if the technician encounters difficulties accessing the premises. (See Pl.'s 56.1 Stat. ¶ 80.) In addition, Metro technicians contact Time Warner's automated ARU system to connect customers' cable service. In doing so, the technicians report the time that they began the installation job and the automated system records the connection time as the time that the technician completed the job. (See Pl.'s 56.1 Stat. ¶ 154.)
Both Metro and Time Warner assess the technicians' work. Metro foremen conduct some quality control inspections. (See Pl.'s 56.1 Stat. ¶ 82.) Time Warner personnel do more: they conduct some 800-900 quality control assessments per week, amounting to 2-4% of all installations that Metro technicians perform. (See Pl.'s 56.1 Stat. ¶ 86.) Time Warner memorializes in writing the results of these assessments and provides copies to Metro. (See Pl.'s 56.1 Stat. ¶ 88.) Time Warner also contracts with an outside vendor to contact customers within 45 minutes regarding installations that Metro technicians have performed at their homes. (See Pl.'s 56.1 Stat. ¶ 96.) In this system, known as ECHO, Metro and Time Warner have access to customers' responses in real time. (See Pl.'s 56.1 Stat. ¶ 97.) Finally, Time Warner compiles and provides to Metro data as to how often technicians use Time Warner's automated systems, a snapshot of the number of open and completed installations, how often Metro technicians complete installations in specified time windows, and how often technicians must make additional visits to correct installation problems. (See Def.'s 56.1 Stat. ¶ 92; Pl.'s 56.1 Stat. ¶¶ 92, 144-154.)
Time Warner and Metro discuss these assessments and reports at monthly meetings. (See Pl.'s 56.1 Stat. ¶¶ 93-94, 168-70.) Metro uses the assessments and reports in determining if, when, and how to discipline Metro technicians. (See Def.'s 56.1 Stat. ¶¶ 90, 143.) In addition, Plaintiffs have presented evidence that Time Warner contacts Metro regarding the worst performing technicians and asks Metro to advise "what actions will be taken." (See Silverman Dec. Exs. 29-30.) However, though the parties dispute whether Metro or Time Warner was actually responsible for disciplining or firing certain technicians, the record does not contain any evidence that Time Warner has ever instructed Metro to discipline or fire any individual technician. Neither of the Plaintiffs who were terminated discussed his termination with anyone from Time Warner; rather, both were notified by Metro personnel. (See Pl.'s 56.1 Stat. ¶¶ 24-25.)
It is undisputed that Time Warner has the power to remove any Metro technician from the list of technicians authorized to perform installations at Time Warner customers' homes. (See Pl.'s 56.1 Stat. ¶¶ 29-30.) Yet Time Warner's decision to de-authorize a technician does not mean that the technician can no longer work for Metro or perform installations for Time Warner. A de-authorized technician can perform other kinds of work for Metro or leave Metro to install Time Warner cable as an Uptown or Broadband Express employee. (See Pl.'s 56.1 Stat. ¶¶ 31, 34.)
At the end of each week, Metro provides Time Warner with an invoice for every job that Metro technicians have completed and requests payment at per-job rates established by Time Warner. (Asher Dec. Ex. 2 at 30.) Metro identifies the rate applicable to a given job based on the rate code that Time Warner has assigned to that job and which appears on the work orders. (Pl.'s 56.1 Stat. ¶ 35; Asher Dec. Ex. 3 at 45-46.) Time Warner checks the invoice against its own data regarding the number of completed installations, deducts faulty installations, and pays Metro the difference. (See Aff. of J.W. Baker Jan. 25, 2011, ¶ 2; Asher Dec. Ex. 2 at 93-94.) Pursuant to the CBA with Local 3, Metro pays its technicians at fixed rates for each hour of work. (See Silverman Dec. Ex. 44 at 54-55, 60;Ex. 46 at 22-23; Ex. 47 at 25-26; Ex. 48 at 48; Asher Dec. Ex. 18 ¶ 6.) Metro also provides additional compensation based on the number of jobs that a technician completes. (See Asher Dec. Ex. 5 at 36; Ex. 9 at 87; Ex. 10 at 25-26; Ex. 18 ¶¶ 6-7.) Metro technicians received payment in the form of paychecks containing a Metro logo, and these payments were reflected on W-2forms issued by Metro. (See Pl.'s 56.1 Stat. ¶ 39.) No plaintiff ever received any payment from Time Warner. (See id.) On August 3, 2009, Plaintiffs filed this action against Metro and Time Warner alleging that they had violated the FLSA by failing to pay Metro technicians one and a half times their normal hourly wage for each hour they worked in excess of forty hours in certain weeks. Plaintiffs filed an amended complaint on October 23, 2009. On February 24, 2010, Plaintiffs moved to amend their complaint a second time to add a retaliation claim against Time Warner, Metro, and various Metro executives. Specifically, Plaintiffs sought leave to allege that that the defendants had retaliated against them for filing or joining this action by reassigning them to less lucrative or more demanding routes and assigning the most lucrative routes to new or less senior technicians. The Court granted Plaintiffs' motion on April 29, 2010 and Plaintiffs filed a second amended complaint on May 5, 2010.
The parties engaged in discovery limited to the issue of whether Time Warner jointly employed Metro technicians. On November 8, 2010, Time Warner moved for summary judgment on the ground that it does not jointly employ Metro technicians.
Summary judgment is proper if the moving party shows that "there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. Proc. 56(c); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). "In deciding whether there is a genuine issue of material fact as to an element essential to a party's case, the court must examine the evidence in the light most favorable to the party opposing the motion, and resolve ambiguities and draw reasonable inferences against the moving party." Abramson v. Pataki, 278 F.3d 93, 101 (2d Cir. 2002) (internal quotation marks omitted); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). However, a party opposing summary judgment "may not rely merely on allegations or denials in its own pleading; rather, its response must-by affidavits or as otherwise provided in this rule-set out specific facts showing a genuine issue for trial." Fed. R. Civ. Proc. 56(e).
Under the law in this Circuit, "the inquiry as to whether an entity is an employer for purposes of the FLSA involves three determinations. First, there are historical findings of fact that underlie each of the relevant factors. Second, there are findings as to the existence and degree of each factor. Finally, there is the conclusion of law to be drawn from applying the factors, i.e., whether an entity is a joint employer." Zheng v. Liberty Apparel Co., Inc., 355 F.3d 61, 76 (2d Cir. 2003) ("Zheng I"). "In order to grant summary judgment for defendants, the District Court would have to conclude that, even where both the historical facts and the relevant factors are interpreted in the light most favorable to plaintiffs, defendants are still entitled to judgment as a matter of law." Id. "To reach that conclusion, the Court need not decide that every factor weighs against joint employment." Id. at 76-77 (emphasis in original).*fn4
The FLSA provides that "no employer shall employ any of his employees . . . for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed." 29 U.S.C. § 207(a)(1). Hence only an "employer" can be liable for failing to pay "time and a half" rates for overtime.*fn5 The instant motion turns on whether Time Warner is Plaintiffs' "employer" for purposes of the FLSA.
The term "employer" in the FLSA "includes any person acting directly or indirectly in the interest of an employer in relation to an employee and includes a public agency, but does not include any labor organization (other than when acting as an employer) or anyone acting in the capacity of officer or agent of such labor organization." 29 U.S.C.A. § 203(d). "Because the statute defines employer in such broad terms," Herman v. RSR Security Services Ltd., 172 F.3d 132, 139 (2d Cir. 1999), and its definitional section uses the term it purports to define, the statute "offers little guidance on whether a given individual is or is not an employer." Id.
In the usual case, a court faced with such an ambiguous statute might turn to how the law has elsewhere defined the employer-employee relationship. Indeed, "[i]in instances where Congress uses terms-such as employer and employment-'that have accumulated settled meaning under . . . the common law,' courts generally infer, unless the statute indicates otherwise, that 'Congress means to incorporate the established meaning of these terms,' e.g., 'the conventional master-servant relationship as understood by common-law agency doctrine.'" Barfield v. New York City Health and Hosp. Corp., 537 F.3d 132, 141 (2d Cir. 2008) (ellipsis in original) (quoting Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 322-23 (1992)).
However, the Supreme Court has observed that the "Act contains its own definitions, comprehensive enough to require its application to many persons and working relationships, which prior to this Act, were not deemed to fall within an employer-employee category." Rutherford Food Corp. v. McComb, 331 U.S. 722, 729 (1947). In particular, the FLSA "defines the verb 'employ' expansively to mean 'suffer or permit to work.'" Darden, 503 U.S. at 326(quoting 29 U.S.C. § 203 (g)). This "definition of 'employ' is broad." Rutherford Food Corp., 331 U.S. at 728; see also Zheng I, 355 F.3d at 66. Indeed, it is "the broadest definition" of the term "that has ever been included in any one act." United States v. Rosenwaser, 323 U.S. 360, 363 n.3 (1945) (quoting 81 Cong. Rec. 7657 (1937) (statement of Sen. Hugo L. Black)). And this "striking breadth . . . stretches the meaning of 'employee' to cover some parties who might not qualify as such under a strict application of traditional agency law principles." Darden, 503 U.S. at 326.
"An entity 'suffers or permits' an individual to work if, as a matter of 'economic reality,' the entity functions as the individual's employer." Zheng I, 355 F.3d at 66; see also Barfield, 537 F.3d at 141 ("[T]he determination of whether an employer-employee relationship exists for purposes of the FLSA should be grounded in 'economic reality rather than technical concepts,' Goldberg v. Whitaker House Coop., Inc., 366 U.S. 28, 33 (1961) (internal quotation marks omitted), determined by reference not to 'isolated factors, but rather upon the circumstances of the whole activity,' Rutherford Food Corp. v. McComb, 331 U.S. at 730."). Again, it is somewhat circular to define one who "employs" in terms of whether "the entity functions as the individual's employer." However, the purpose of the "economic reality" test-"to expose outsourcing relationships that lack a substantial economic purpose"-points to a lodestar for determining when an employer has outsourced work in name only: the "overarching concern is whether the alleged employer possessed the power to control the workers in question." Herman, 172 F.3d at 139.
Notably, control in this context is not an all or nothing concept. "Control may be restricted, or exercised only occasionally, without removing the employment relationship from the protections of the FLSA, since such limitations on control 'do not diminish the significance of its existence.'" Id. (quoting Donovan v. Janitorial Servs., Inc., 672 F.2d 528, 531 (5th Cir. 1982)). And "even when one entity exerts 'ultimate' control over a worker, that does not preclude a finding that another entity exerts sufficient control to qualify as a joint employer under the FLSA." Barfield, 537 F.3d at 148. Accordingly, the Second Circuit has recognized that a worker can have more than one employer for purposes of the FLSA. Indeed, "[t]he regulations promulgated under the FLSA expressly recognize that a worker may be employed by more than one entity at the same time." Zheng I, 355 F.3d at 66; see also Barfield, 537 F.3d at 141. Cf. 29 C.F.R. § 791.2 (2003).*fn6
How do courts ascertain "economic reality?" The very open-endedness of the term denotes that it is "a flexible concept to be determined on a case-by-case basis by review of the totality of the circumstances." Barfield, 537 F.3d at 141-42. In Carter v. Dutchess Community College, 735 F.2d 8 (2d Cir. 1984), the Second Circuit identified four factors particularly relevant to the joint employment inquiry: "'whether the alleged employer (1) had the power to hire and fire the employees, (2) supervised and controlled employee work schedules or conditions of employment; (3) determined the rate and method of payment; and (4) maintained employment records.'" Id. at 12 (quoting Bonnette v. Calif. Health & Welfare Agency, 704 F.2d 1465, 1470 (9th Cir. 1983)). The Court of Appeals has described these as factors as a test "for determining when an entity exercises sufficient formal control over a worker to be that worker's employer under the FLSA. . . ." Barfield, 537 F.3d at 143.
However, "the broad language of the FLSA . . . demands that a district court look beyond an entity's formal right to control the physical performance of another's work before declaring that the entity is not an employer under the FLSA." Zheng I, 355 F.3d at 69. Hence not only is "[n]o one of the four factors standing alone . . . dispositive," Herman, 172 F.3d at 139, but the Second Circuit has "expressly denied" the proposition "that the four factors borrowed from the Ninth Circuit in Carter are the exclusive touchstone of the joint employment inquiry under the FLSA." 355 F.3d at 71. While those factors "can be sufficient to establish employer status," "Carter did not hold . . . that those factors are necessary to establish an employment relationship." Id. (emphasis in original). Rather, "in certain circumstances, an entity can be a joint employer under the FLSA even when it does not hire and fire its joint employees, directly dictate their hours, or pay them." Id. at 70.
In Zheng I, the Second Circuit identified six additional factors that district courts "will find illuminating" in determining whether a putative joint employer exercises functional control:
(1) whether [the putative joint employer]'s premises and equipment were used for the plaintiffs' work; (2) whether the Contractor Corporations had a business that could or did shift as a unit from one putative joint employer to another; (3) the extent to which plaintiffs performed a discrete line-job that was integral to [the putative joint employer]'s process of production; (4) whether responsibility under the contracts could pass from one subcontractor to another without material changes; (5) the degree to which the [putative joint employer] or [its] agents supervised plaintiffs' work; and (6) whether plaintiffs worked exclusively or predominantly for [the putative joint employer].
Id. at 71-72. A district "court is also free to consider any other factors it deems relevant to its assessment of the economic realities." Id. at 72.
"[B]y looking beyond a defendant's formal control over the physical performance of a plaintiff's work, the 'economic reality' test-which has been distilled into a nonexclusive and overlapping set of factors-gives content to the broad 'suffer or permit' language in the statute." Id. at 76 (quoting 29 U.S.C. § 203(g)). "However, by limiting FLSA liability to cases in which defendants, based on the totality of the circumstances, function as employers of the plaintiffs rather than mere business partners of plaintiffs' direct employer, the test also ensures that the statute is not interpreted to subsume typical outsourcing relationships." Id.
Applying similar multifactor tests, several federal courts, including one in this Circuit, have held that telecommunications service providers such as Time Warner are not joint employers of contract technicians who install those services. See Lawrence v. Adderley Ind., Inc., No. CV-09-2309, 2011 WL 666304 (E.D.N.Y. Feb. 11, 2011);
Jacobson v. Comcast Corp., 740 F. Supp. 2d 683 (D. Md. 2010). Cf. Smilie v. Comcast Corp., No. 07-CV-3231 (N.D. Ill.) (Slip Op., Feb. 25, 2009) (attached as Ex. 52 to Silverman Dec.). But see Keeton v. Time Warner Cable, Inc., No. 2:09-CV-1095, 2011 WL 2618926 (S.D. Ohio, July 1, 2011) (applying different Sixth Circuit test and finding material issues of fact as to joint employment issue. Recently the Supreme Court of the State of New York, Queens County, granted summary judgment to Time Warner in a purported class action by MCC employees that raised claims virtually identical to those presently before the Court. Rodriguez v. Metro Cable Commc'ns, Inc., No. 21517/2008 (N.Y. Sup. Ct. July 26, 2011).
The Court will begin its analysis by applying the four Carter factors "to examine the degree of formal control," if any, exercised by Time Warner. Barfield, 537 F.3d at 143. If Time Warner "lacked formal control," the Court will then apply the six Zheng factors and any other relevant factors "to assess ...