Da Costa, et al. v. Vanguard Cleaning Systems, Inc. (Lawyers Weekly No. 09-021-17)
COMMONWEALTH OF MASSACHUSETTS MIDDLESEX, ss. SUPERIOR COURT CIVIL ACTION 15-04743 LUIZ THOMAZ DA COSTA & others[1] vs. VANGUARD CLEANING SYSTEMS, INC. MEMORANDUM OF DECISION AND ORDER ON PLAINTIFFS’ CROSS-MOTION FOR SUMMARY JUDGMENT AND DEFENDANT’S CROSS-MOTION FOR SUMMARY JUDGMENT The plaintiffs, Luiz Thomaz Da Costa and others, and the defendant, Vanguard Cleaning Systems, Inc. (“Vanguard”), have filed cross motions for summary judgment seeking a ruling on the plaintiffs’ employment classification status under the laws of Massachusetts and Connecticut in connection with commercial cleaning work which the plaintiffs claim they performed on behalf of Vanguard. G.L. c. 149, § 148B; Conn. Gen. Stat. § 31-222(a)(1)(B). After hearing, and upon review and consideration, the plaintiffs’ cross-motion for summary judgment is ALLOWED, and Vanguard’s cross-motion for summary judgment is DENIED. BACKGROUND The undisputed facts, and any disputed facts viewed in the light most favorable to the non-moving party, are as follows. Additional facts are reserved for discussion below.[2] Vanguard is a corporation headquartered in California that operates a three-tier franchise system selling commercial cleaning services. Vanguard sells licenses to use its name and trademarked Vanguard Cleaning Systems in defined geographic areas to regional master franchisees. Regional master franchisees, in turn, enter into franchise agreements with unit franchisees, which conduct commercial cleaning. [3] Vanguard receives four percent of regional master franchisees’ gross revenue, which consists of payments for commercial cleaning and fees levied on unit franchisees.[4] Vanguard solicits business through national sales bids, and offers quotes to prospective customers on its website; Vanguard’s website forwards cleaning account leads to regional master franchisees. Regional master franchisees implement Vanguard’s commercial cleaning framework. Vanguard provides regional master franchisees with extensive operating instructions, forms, and templates. Vanguard authored the franchise agreements that regional master franchisees and unit franchisees execute, but is a non-signatory to these agreements. Vanguard also drafted the franchise disclosure document, operations manual, cleaning safety manual, and commercial cleaning information manual. Additionally, Vanguard supplies regional master franchisees with accounting software and templates, which include franchise agreements and account acceptance forms. Unit franchisees must meet current and future standards outlined in Vanguard’s operations manual. Vanguard requires that unit franchisees form independent entities to conduct cleaning services. Vanguard prohibits unit franchisees from billing client accounts for cleaning supplies; unit franchisees must purchase their own supplies. Vanguard imposes minimum standard service requirements, along with detailed instructions on how to clean commercial spaces. Vanguard also requires that unit franchisees attend a mandatory training program, and emphasizes that unit franchisees are subject to Vanguard’s quality control standards. Vanguard outlines a series of inspections and oversight methods in its operations manual. For example, Vanguard representatives routinely conduct room-by-room quality control inspections if the client […]