Joseph A. D'Avanzo Receives Favorable Ruling on behalf of a Model Management Agency client in Employer Classification Hearing
Joseph A. D'Avanzo, Managing Partner of Pashman Stein's New York office, and the head of its New York litigation practice, received a favorable ruling for his client, a major model management agency in New York, on March 19, 2019, regarding the employment classification of the fashion models the agency represents. In an Opinion by Administrative Judge Rachel Freeman of the New York State Unemployment Insurance Review Board, Administrative Law Judge Section, found that the credible evidence established that the models employed the agency and that all of the factors pointed to the existence of an employment relationship that was the reverse of the one that was found by the auditor. As such, based upon the facts of the models’ relationship with the agency, the model agency was not subject to making unemployment insurance contributions on behalf of the models, and a fine of $363,000 from the New York State Department of Labor was reversed. “This decision is part of a larger battle that is being waged in the fashion model industry,” said Joe, “in which models have been attempting to be classified as employees of the modeling agencies, rather than independent contractors and the entrepreneurs that they are in fact. The Administrative Judge’s ruling clarifies that the modeling agency is not an employer, but instead an agent of the models, eliminating any liability for insurance contributions on the models’ behalf.” This ruling comes close on the heels of another favorable ruling obtained by Joe for the same client in an appeal before the Appellate Division, First Department, which upheld the dismissal of alleged violations of the New York Labor Law for alleged misclassification of the agency’s models as independent contractors rather than employees, in a class action by current and former fashion models. Shanklin, et al. v. Wilhelmina Models, Inc., et al., 161 A.D.3d 610 (1st Dept 2018).
As background, the state’s auditor had initially determined that the models were employees of the modeling agency, and as such the modeling agency was an employer mandated to pay unemployment insurance premiums for each model represented by the agency during the period of 2015 - 2017. The auditor issued a fine of $363,000. The modeling agency appealed the auditor’s decision and requested a hearing. Based upon the facts presented, Judge Freeman reversed the auditor’s decision and found that the modeling agency was not the employer of the models, but merely the agent of the models.
Joe’s litigation practice includes the representation of entertainment, fashion and sports managers and their talent; aerospace, biotech and life science companies; product manufacturers; and real estate development, investment and construction firms. In addition to trying jury and non-jury cases and arguing appeals on behalf of companies and individuals in both federal and state courts, Joe has served as lead national trial counsel for corporations including IBM, UPS and Perrier, regarding mass tort, product liability and class action litigation.
A copy of the decision can be found here.