Knowledgebase-Is a Certain Contract City Administrator an Employee or an Independent Contractor?
FROM: Sid Hemsley, Senior Law Consultant
DATE: March 22, 2006
RE: “Administrative Consultant–Town Operations Supervisor” Status
You have two questions:
1. Is the board of mayor and aldermen’s delegation of certain administrative functions to the “Administrative Consultant–Town Operations Supervisor” legal?
The answer is yes, if that delegation has been accomplished by ordinance. The contract between the city and Mr. A is reflected in a resolution dated February 15, 2005. I do not know whether the resolution is supported by an antecedent or subsequent ordinance.
2. Is a person holding the above position an employee or an independent contractor?
The person is an employee.
Analysis of Question 1
The City is chartered under the general law-mayor aldermanic charter. Section 6-3-106 of that charter provides that the mayor perform most of the administrative functions of the city. However, Section 6-3-10(b) says that:
Unless otherwise designated by the board by ordinance, the mayor shall perform the following duties or may designate a department heard or department heads to perform any of the following duties:
(1) Those duties set forth in § 6-4-101, if the board does not appoint a city administrator, or if someone else is not designated by the board to perform those duties.... [Emphasis is mine.]
Section 6-4-101 authorizes the board to “appoint a city administrator, who shall be under the control and direction of the board. The city administrator shall report and be responsible to the board.” There follows in that section a list of the duties of a city administrator.
Section 6-4-104 speaks only of the board’s appointment of a city administrator to perform those listed duties. However, § 6-3-106(b)(1) says that:
- The mayor shall perform the following duties “[u]nless otherwise designated by the board by ordinance.” [Emphasis is mine.]
- Among those duties, are “Those duties set forth in § 6-4-101, if the board does not appoint a city administrator, or if someone else is not designated by the board to perform those duties;” [Emphasis is mine.]
Nothing in that provision indicates that the appointment of “someone else” by the board is limited to an officer or an employee mentioned in the charter.
A question similar to this one arose in Ruddell v. City of LaVergne, 1993 WL 501371 (Tenn. App. 1993). There the board had appointed an “Assistant to the Board,” to whom the board gave those duties contained in § 6-4-101 (as well as other duties contained in § 6-3- 106) of the charter. The Court of Appeals upheld the authority of the LaVergne Board of Mayor and Aldermen to delegate to the Assistant to the Board the administrative duties contained in § 6-4-101(b), provided that delegation was done by ordinance. That case is unreported, and for that reason does not have the same precedential value as do reported cases, but it is probably correctly decided.
The Tennessee Courts in many old but still good cases have also distinguished between legislative and administrative functions, and have upheld governing bodies’ delegation of the latter functions. [See Mayor of Chattanooga v. Geiler, 81 Tenn. 611 (1884); Whyte v. Mayor of Nashville, 32 Tenn. 364 (1852); City of Memphis v. Adams, 56 Tenn. 518 (1872); Nashville v. Fisher, 1 Tenn. Cas. 345 (1874); Rockwood v. C.N.O. & T.P. Ry., 160 Tenn. 32, 22 S.W.2d 237 (1929); Lotspeich v. Morristown, 141 Tenn. 113, 207 S.W.719 (1918).]
It is said in City of Rockwood, above, citing Gelier, above, that:
It cannot be supposed that the Legislature in giving the Mayor and Aldermen the power enumerated in their charter intended that they should be held to the personal performance of every duty imposed. From necessity a municipal, as well as other corporations, must discharge many of its functions and duties by officers and agents.
The same case also said that, “The general rule against delegation by municipal bodies does not forbid the delegation of ministerial, executive, or administrative functions to subordinate officials.”
Arguably, the contract in Ruddell, can be distinguished from the contract between the City and Mr. A. The delegation of duties to the Assistant to the Board in Ruddell tracked the duties contained in § 6-4-101 of the charter, while the delegation of duties to the Administrative Consultant in the latter contract do not. That delegation of administrative duties in that contract follows:
1. Coordinate administrative duties/activities of the City Departments under the Board of Mayor and Aldermen.
2. Be responsible to the Board as a whole and take official instructions from the Board as a group.
3. To be present at the Municipal building and/or performing duties on behalf of the Town and equivalent of three (3) working days per week.
4. To attend all meetings of the Board and....the meetings of all municipal boards, commissions, and committees as requested by the Board or various civic recommendations. [Sic.?]
5. Research projects as assigned by the Board and report to a full Board on the finds and recommendations.
6. Acts as a liaison for the Board for the Town with different government agencies....development districts, industry, MTAS, ETDD, State legislators, etc.
7. Work to develop a win/win attitude with all employees and/or Board for mutually beneficial solutions to all problems.
8. Work to develop short-long range plans to keep the town financially sound.
While those duties do not expressly track the duties contained in § 6-4-101 of the city’s charter, a rose by any other name is still a rose. It appears to me that the intent and effect of that delegation is a delegation of the duties to the Administrative Consultant so similar to the duties of the city administrator listed in § 6-4-101 that the courts would not be impressed with the distinction. As Ruddell itself points out, under City of Lebanon v. Baird, 756 S.W.2d 236 (Tenn. 1988), when a statute requires municipal action to be taken in a certain way, that action must comply with that requirement; otherwise, it is ultra vires.
The requirement contained in § 6-3-106, and d in § 6-4-101 of the city’s charter is that such a delegation be made by ordinance.
Analysis of Question 2
The contract between the City and Mr. A, appears to treat Mr. A as an independent contractor. However, Mr. A is clearly subordinate to the control of the board in how he does his job. Under Duty No. 2, he is to “Be responsive to the Board as a whole and take official instructions from the Board as a group.” Under Duty No. 3, he is to be present at the Municipal Building and/or performing duties on behalf of the Town an equivalent of three (3) working days per week.” Under Duty No. 4, he is required “To attend all meetings of the Board and...the meetings of all municipal boards, commissions, and committees as requested by the Board or various civic recommendations.” Under Duty No. 5, he is required to “Research projects as assigned by the Board and to report to a full Board on the finds and recommendations.” Under Duty No. 6, he is to “Act as a liaison for the Board for the Town with different government agencies.”
It is said in various Tennessee Cases that the primary question the courts consider in determining whether a person is an employee or an independent contractor is who controls the person’s work. [See Wilson v. Thompson Construction Co., 86 S.W.3d 536 (Tenn. Ct. App. 2001); Masiers v. Arrow Transfer & Storage Co., 639 S.W.2d 654 (Tenn. 1985); Carver v. Sparta Electric System, 690 S.W.2d 218 (Tenn. 1985); Stratton v. United Inter-Mountain Tel. Co., 695 S.W.2d 947 (Tenn. 1985).]
In Carver v. Sparta Electric System, above, the court held that a Carver, who was employed by a tree service to cut tree limbs around the power lines operated by Sparta Electric System, was actually an employee of Sparta Electric System when he got injured on the job.The Court said this about who has the right to control a person’s work:
In determining whether the relationship is that of employer- employee or that of an independent contractor, we have said that the following factors are to be considered and that no one factor is necessarily dispositive: (1) right to control the conduct of the work; (2) right of termination; (3) method of payment; (4) whether alleged employee furnished his own helpers; and (5) whether alleged employee furnishes his own tools.
Although no single fact is necessarily dispositive, we have repeatedly emphasized the importance of the right to control. [Citations omitted by me.] The test is not whether the right to control was exercised but merely whether the right to control existed. [Citations omitted by me.] In the case at bar, there is abundant evidence that a right to control existed. At the beginning of each work day, Mr. Lee [the owner of the tree service which employed Carver] received his assignment from the Manager or Superintendent of Operations of Sparta Electric. If problems developed during te day, Defendant could order Mr. Lee and Plaintiff to go to that location. Mr. Lee was also not free to accept other employment if it interfered with Mr. Lee’s ability to perform 40 hours of work per week for Sparta Electric. The record supports that finding that Sparta Electric not only had the right to control but also exercised a degree of control that was more pervasive than merely insuring that the end result conformed to the plans and specifications. [At 220]
Under the control test, the party contracting for work can exercise direction and control over the results of the work, but the contract between the city and Mr. A, clearly gives the board exquisite control over the performance of the work, including that he work a certain number of days at city hall, that he attend all city meetings and other civil meetings, that he act as a liaison to various other governmental agencies, and that he be responsible to the board “and take official instructions from the board as a group.” Mr. A must work for three days at the city hall, a fact that strongly implies that he cannot work for someone else during that period. Nothing in the contract points to Mr. A as an independent contractor.
There are other indica for determining whether a person is an employee or an independent contractor that indicates that Mr. A is an employee, but I do not think it necessary to go into those. [See 14 TENNESSEE JURISPRUDENCE, Independent Contractors, especially §§ 1-4, pp. 538-544].
The implication of the distinction between employees and independent contractors is that the liabilities of the city for the conduct of those two classes of persons are different. Generally, a city is liable for many forms of conduct on the part of its employees, while the same is generally not true with respect to independent contractors. In addition, a city is generally liable under the Workers Compensation Law for injuries to employees, but not for injuries to independent contractors. In connection with the former liability, if any City official has doubts about whether the Administrative Consultant is an employee or independent contractor, he or she need only ask this question: Is any Tennessee court is going to hold that an Administrative Consultant who is handling the day-to-day administrative functions prescribed by the contract between the city and Mr. A is anything but an employee if he injures someone in the performance of those duties?