It should come as no surprise that nothing good comes out of Ohio when it comes to the Rights of Labor. NAMFS is based out of Ohio. Credible Home Inspections is based out of Ohio. Safeguard Properties is based out of Ohio. ZVN Properties is — well, you get the point. All of these firms want to steal your hard earned pay. NAMFS — the National Association of Mortgage Field Services — a near bankrupt and loose consortium of firms which makes money off the backs of misclassified employees by calling it member dues, leads the charge attempting run interference for the highest bidder. The rest of these firms are so deep in Labor’s pocket that one might think they are at a strip club getting a handjob.
Ohio has a great agency called the Bureau of Workers’ Compensation (BWC). For want of better words, the BWC — don’t think that way just yet — is the only thing that NAMFS members fear in Ohio. Now, in May of 2022, the BWC issued a ruling that a firm had been getting into the pockets of Labor, much like NAMFS members, and they had had enough of it — both the BWC and Labor. The case kicking around for a bit and did the obligatory journey all the way up to the Ohio Supreme Court where it was finally codified as State ex rel. Ugicom Enterprises, Inc. v. Morrison, — N.E.3d —- (2022). It was All the Usual Suspects pertaining to a company which had misclassified its workers as independent contractors rather than as employees. And you know what? The BWC looked back 5 years and handed the company a bill for $350,000 in back assessments for failing to pay into the workers compensation system. Companies pay into the system for employees, but not for contractors.
I digress. Let’s talk about the Ohio Supreme Court ruling, for just a moment. Section 3 entitled Method of payment is what stood out to me and specifically at paragraph 21,
{¶ 20} The bureau determined that the method by which Ugicom paid the installers further indicated that the installers were not independent contractors. The bureau focused on the installers’ prospect of profits or losses. When asked how the installers were paid, Kibuuka testified that he would “make up” an amount to pay the installers for each type of service: “So, for instance if Time Warner pays me a hundred dollars to drill a sidewalk, then I will pay my contractor $80 to do that same sidewalk and Ugicom will keep the $20, something like that.” In other words, Ugicom’s rate of pay was nonnegotiable, meaning that Ugicom foreclosed the installers from submitting bids. The bureau reasoned that the installers were distinct from independent contractors in the construction industry who “maintain[] their own separate business [and] take[] into consideration all of their expenses when pricing work in order to make a profit and [are] at risk of a loss.”
That’s a lot to digest so let me break it down in the way that only a trained media professional such as myself is capable of doing. No one has ever submitted a real bid in this Industry. First of all, Inspectors are told what they will be paid, period. Second, Field Service Technicians are told what they will be paid on virtually EVERYTHING! The Mortgagee Letter is a prime example. Moreover, though, the percentages deducted above are the same way that this Industry operates. And any bid is simply an illusion because it must conform with the mandatory guidelines and alleged HUD adjusted bids. We know this going all the way back to the days of Tom Kalas up at Five Brothers in his Memo to Kelly Brown — fortune cookie there for Littlejohn & Co. whom are looking to buy Five Brothers.
Now, a dirty little secret that NAMFS members such as Cyprexx, MCS, and Guardian Asset Management don’t want you to know is that they all operate W2 employees performing the very same work that their misclassified employees are doing today. MCS celebrates this fact in their own financial pitch deck and on their website here. In fact, many times Field Service Technicians will submit bids that comply with mandated pricing and then these firms and other NAMFS members simply submit the bid for payment to the US government and in turn, send their W2 employees out to do the work at a lower rate.
Ergo, the question of whether the work is part of the regular business of the employer is answered in the negative because both the Vendor and Labor perform the same services.
And while I could meander in and out with far more justifications, the reality is that there is no longer a single state in which NAMFS members and their supporters will be able to justify their employee misclassification. They do the same work, they force a price list upon misclassified employees, and they refuse to allow Labor to share in anything.
The icing on the cake in this case was this,
We conclude that some evidence supported the determinations, namely, the evidence showing Ugicom’s exertion of control over the installers through its method of payment. Ugicom’s take-it-or-leave-it approach to pricing the jobs, which foreclosed an installer’s ability to submit a bid, was a means of controlling the installers.
I want to point out another critical piece of information, though. It pertains to both the length of employment,
{¶ 25} The bureau determined that Ugicom had an ongoing relationship with the installers. In support of that finding, the bureau pointed to the “high dollar amounts” reflected on the installers’ Forms 1099, which the bureau reasoned was indicative of large volumes of work performed by the installers. The bureau also inferred that the installers were involved in an ongoing relationship with Ugicom because there was no evidence showing that the installers had advertised their services to the community at large.
Moreover, the most we can find in the record is a bare line item showing that Lule claimed a $20 advertising expense for one tax year.
The time has come to take these people down. And in light of the fact that it is now a felony in three states — Rhode Island and New York — to misclassify an employee and New Jersey’s Temporary Worker Bill of Rights just went into effect and it applies to our Industry, it is time to bring coordinated actions.
New Jersey’s Temporary Worker Bill of Rights — Section 7(b) requires that temp workers “shall not be paid less than the average rate of pay and average cost of benefits, or the cash equivalent thereof, of employees of the third party client performing the same or substantially similar work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions for the third party client at the time the temporary laborer is assigned to work at the third party client. Each violation of this subsection for each affected temporary laborer shall constitute a separate violation….”
Below is the Ohio Supreme Court case for those whom want to read it in its entirety. And before you go, why not hit the Donate Button? Believe it or not, I bust my ass, day in and day out, to make sure Labor gets a fair shake.
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