Saleem v. Corporate Transportation Group, Ltd.

Facts

The plaintiffs are black-car drivers and franchise owners in the tri-state area affiliated with the defendant franchisors. About 700 cars were associate with the defendants’ dispatch bases. The plaintiffs for the most part rented or purchased franchises directly from the defendants. Renting cost $130-$150 per week, and buying came with fees as high as $60,000. Franchisees were also required to obtain licenses from the New York City Taxi & Limousine Commission (TLC). The franchise agreements contained language that stated that franchisees were not considered employees of the defendant franchisors. The agreements also contained a non-compete provision that disallowed franchisors from transporting passengers without processing payment through defendants. The plaintiff franchisees also had to conform to a dress code and other rules of conduct from the defendants. The plaintiffs had a considerable amount of freedom to run their own cars and work certain hours as they saw fit. Plaintiffs took home up to 85% of their fares, so plaintiffs classified themselves as independent contractors on tax returns, taking substantial business deductions.