Rene Cudal was the last to quit. The Friday after Labor Day 2005 was the day he’d marked in his calendar, but he procrastinated all morning and afternoon, dreading the moment his boss would put two and two together. Finally the boss went home. Cudal called him that evening and gave him two weeks’ notice.
A bike messenger quitting isn’t so unusual–messengers will tell you they all develop a strategy to extract themselves from the job, which is defined by a high risk of bodily harm, low wages, and few or no benefits. Michael Carey, Cudal’s boss at On Time Courier, was a former messenger himself. But Carey, a big, block-shouldered man with a reputation as both a polished salesman and a hard-line intimidator, didn’t take Cudal’s news well. “What’s happening?” Cudal remembers him saying. “What are you doing? Starting your own messenger company?”
Cudal was in agony. “Well,” he said, “yes.”
One by one over the past three weeks, Cudal’s partners Jack McLaughlin, Josh Korby, and Mike Morell had resigned from On Time to get to work on their own company, 4 Star Courier Collective. There are more than half a dozen courier companies in Chicago run by former messengers, but 4 Star would be different: it would be worker-owned and -operated, the first messenger co-op in Chicago and only the third in the U.S.
In an act of bravado Carey apparently hadn’t noticed, in August, before any of them had quit their old jobs, the 4 Star couriers sent out a press release explaining that they were striking out on their own because they were “fed up with the exploitative nature of most courier companies in Chicago.” They announced the “first annual” 4 Star bike messenger prom, preceded by a pedaling parade that offered tattooed young women in prom dresses and held in a building where the super was a former messenger. Around 200 people showed up, the party netted $700, and because almost everyone there was a courier the collective interpreted it as a vote of confidence from the “community.” Korby, a 28-year-old with a BFA from the Art Institute, anonymously told the Tribune, “We want to bring a personal side to the messenger industry. We’ll be the owners. We’ll care.”
The company name alludes to the four stars on the Chicago city flag. There were actually five founders, the fifth and youngest being Jen Greenberg, a 19-year-old college dropout and occasional velodrome racer who’d been a messenger only a year and a half. She rode for Arrow Messenger and wouldn’t have enough money saved to quit until later in the fall. The five of them figured they needed a couple thousand dollars in the bank apiece to cover costs while they were getting started.
Friends and colleagues admired their chutzpah and questioned their wisdom. For a decade and a half the industry had been in decline, as faxes and e-mail ate into its market. About 70 messenger companies did business in Chicago in 2001. Four years later there were half that many. “The way this business is now, you’d be foolish to start a new messenger company,” said a veteran messenger. “The industry is cutthroat. These companies will do anything to squash a competitor.”
As a senior at Northwestern University’s journalism school, Mike Morell published a story about bike messengers in the student newspaper. It was March 2001, and he’d returned to school the previous fall after dropping out for six months, soured on journalism by an internship at a small California daily. They’d put him through the usual paces, made him telephone the family of a politician who’d just died in a car accident. He never got over feeling that he’d invaded their privacy.
During his break from school he needed money. He’d answered a Reader ad placed by Standard Courier, an operation that used about 15 bike messengers, and was delivering packages the next day. “They just gave me a postcard-size map of the Loop, asked if I had a helmet, and sent me out,” he says. “I was as green as you could get.” Born and raised in San Diego, he knew little about Chicago geography. Messenger culture was new and strange to him, and he expected his time in it to be brief.
But soon enough Morell learned the ins and outs of the Loop grid. He learned how to transport boxes nearly his own size by balancing them on his handlebars. He learned how to ride a fixed-gear bike, the de rigueur rig for most messengers–no derailleurs, no freewheel, no brakes. He learned how to balance on his bike at stoplights–back a quarter crank, forward a quarter crank, the front wheel at an angle just so. At five-seven and 130 pounds, he rode lightly in the saddle, like a jockey. When he went back to school, he kept the job. In his piece for the Daily Northwestern he put it like this:
“Being a messenger means more than a paycheck. It means fresh air and sunshine, wind and snow. It means muscle and endurance, stink and sweat. It means camaraderie and it means being ostracized. Whether it’s freedom from four walls, from corporate culture or from a life on the streets, the bike messenger values independence.” It was the last story Morell wrote.
After graduation he went full-time at Standard. He’d come home at night with aching joints and wake up in the morning with a swollen knee. There were days he could barely walk. His rookie season he made only about $300 a week, but he lived frugally–to date he’s never paid more than $450 a month in rent, and he hasn’t owned a car since becoming a messenger. “As far as expenses go,” he says, “it’s rent, food, and beer.” And bicycles. Morell estimates that he’s spent about $5,000 on gear since becoming a messenger, including two $1,200 bikes he calls “my only luxuries.”
Standard paid him the industry standard–a 50 percent commission on each delivery run, or “tag” in messenger parlance. Companies charge about $6 a tag, give or take a few quarters depending on the length of the run, the weight of the cargo, and the urgency of getting it to where it’s going. Morell put in nine-hour days, and as often as not lunch meant a sandwich in one hand and a handlebar in the other. Caught up now in the culture of the messenger, he had bicycle gears tattooed on both wrists.
Toward the end of his time there Morell achieved about the closest thing to a sinecure that a messenger can get. Standard assigned him a single client, a big downtown company that sent out 40 packages a day, all to other nearby offices. This gave him time to “work the board,” taking whatever other jobs the dispatcher had coming in. He was making about $600 a week after taxes, $24,000 a year. Morell had reached the top of his field. But he was increasingly dissatisfied.
One afternoon about a year into the job, Morell took a corner too fast and tight. His bike slid out and he hit the ground chin first. He finished his run anyway, then pedaled to the emergency room, where he got eight stitches. He says his manager at Standard “strongly encouraged” him to use his Northwestern student insurance to protect the company’s worker’s comp premiums.
A few months earlier Morell had done his first taxes as a bike messenger. Because he was classified as an independent contractor, no taxes were withheld from his pay and there was no employer to pay half his social security contribution. He owed about $4,000. “It cleaned me out,” he says.
He got no paid sick days, no overtime, no paid vacations or holidays, no health insurance, no disability, no unemployment benefits should he lose his job. He engaged his bosses in “ongoing debate,” and their logic was the logic of the rock and the hard place. Standard could either give its couriers benefits or give them work.
Morell thought it might be fine to be an independent contractor if the company would treat him like one. But he says he was told to buy and wear a $30 vest or face a $50 fine, to buy five T-shirts with the Standard Courier logo at $5 apiece, and to rent a two-way radio from Standard for $40 a week. The vest was black and heavy; in the summer sweat poured off him. He stopped wearing it, got caught, was warned, got caught again. The third time, his pay was docked $50.
After that Morell began looking for another job. He wanted a company that either classified its couriers as employees or gave them more actual independence. On Time did both. Pay was on commission and there was no health insurance, but his taxes would be withheld and the company even offered a 401(k) plan–unheard-of in the industry. And On Time seemed less hung up on rules and regulations. “They didn’t micromanage,” he says. “They pretty much said, ‘Go ride, work hard, make some money,’ and that’s what I was looking for.” When On Time hired him he quit Standard on the spot.
“But if I’d been an employee,” he says, “I would have given them two weeks’ notice.”
The Chicago Messenger Service is the oldest and largest courier company in the city. Founded in 1964 by Hymen Factor, it has about 100 bike messengers and 480 drivers on its roster. The company made them all independent contractors about 25 years ago, the first courier company in Chicago to do so. “It’s a win-win-win,” says president William Factor, son of the founder. “It’s a win for the company and for our customers because we don’t have any unproductive help, as opposed to an hourly guy who has no incentive to rush, and who’ll sit in a diner all day and read the newspaper and have a cup of coffee. And it’s a win for the couriers. Most are like businesspeople–it’s like they own their own businesses.”
Regulators have estimated that this model can reduce payroll costs by up to 40 percent, and today 70 percent of the nation’s couriers are treated as independent contractors. The U.S. Revenue Act of 1978 allows employers to classify workers as they see fit provided there’s a “reasonable basis” for it. Reasonableness turns on the question of who controls the work. Who decides length and place of employment? Who reserves the power to hire and fire? In 1992 the Illinois Department of Employment Security ruled that Chicago Messenger Service controlled the work. This meant that its couriers were employees, not contractors, and that the company owed the state some $125,000 plus interest for two year’s worth of unpaid employment insurance contributions. Appeal followed appeal, but last year the Illinois Appellate Court upheld IDES and the Illinois Supreme Court denied the company a hearing.
It was a defeat that apparently had no immediate effect on any other company, and one that CMS doesn’t accept. “We wholeheartedly believe that they’re independent contractors, and we’ll continue to fight the issue, along with 70 percent of the industry,” says Factor. “We have lobbyists. We have lawyers. We’ll continue to litigate it.”
Around the time Morell left Standard, he helped resuscitate a group called the Windy City Bike Messenger Association, which, in his words, “was about building community, getting organized, and helping each other out.” Windy City started up in the mid-90s, but when its founders quit the biz it went into hibernation. For a year overlapping 2003 and 2004, Morell was Windy City’s chairman. As many as 40 couriers showed up for meetings at the Handlebar in Wicker Park every other Monday. There were picnics, bicycle polo matches in Humboldt Park, messenger races, and benefit parties for bikers injured on the job. “It wasn’t an inherently political body,” Morell says. This was to change.
At the meetings complaints about the workplace inevitably arose, and other couriers’ experiences made Morell’s troubles at Standard seem trivial. He heard reports of couriers saddled with thousands of dollars in medical bills–a man in a coma, a man with a fractured elbow, a woman with nerve damage after a truck ran over her arm. Though under state law and city statutes all messenger companies must provide workers’ comp whether or not they use independent contractors, disability payments for injured bikers were sometimes delayed and sometimes nonexistent. The Windy City BMA formed a grievance committee, and in the summer of 2003 it began looking for ways to organize a labor union. After flirting with the AFL-CIO, it became affiliated with the International Workers of the World, the Wobblies, already active with messengers in Portland, Oregon. A Chicago Couriers Union was formed, and the Windy City BMA faded away.
The union has pursued individual messengers’ cases. It retains a lawyer who’s litigating workers’ comp cases for five injured bikers at the moment. In 2004 it filed an unemployment claim on behalf of a Standard bike messenger, and the Illinois Department of Employment Security ruled that the messenger was an employee. In the winter of 2005 members of the CCU organized a two-hour “radio-silence strike” at Arrow, winning a 25-cent-per-tag increase for couriers who’d been on the job longer than two years. But there are no union shops, and there’s been no collective bargaining on any significant scale.
In 2003 Chicago Messenger Service became the first courier service in Chicago to hire a Massachusetts company called the National Independent Contractors Association, or NICA, to administer its payroll and provide couriers with accident and liability insurance in lieu of workers’ comp. NICA serves some 400 companies with 16,000 couriers in 42 states, not least by going before regulatory agencies to argue that the couriers are independent contractors. Bikers despise the “membership fee” that NICA collects–about $80 for cyclists and $100 for drivers–by deducting it from the paychecks it issues.
Not long after CMS hired NICA, so did another big courier service, Dynamex (though only for its drivers), then three others in quick succession. The Chicago Couriers Union began a Stop NICA campaign in the summer of 2004. On payday, union members assembled outside the headquarters of Quicksilver and Standard and distributed flyers urging the couriers there to resist. But both companies eventually became NICA shops.
Couriers aren’t the only ones who have trouble buying the idea that NICA genuinely represents them. In May NICA founder and president Thomas McGrath was indicted by the state of California–where his firm does about a third of its business–on 50 counts of conspiracy and fraud. In California’s view, workers’ comp claims NICA had filed on behalf of injured couriers were illegitimate because the couriers didn’t work for NICA. McGrath had already done time after pleading guilty in 1996 to similar fraud charges in a federal court in Boston.
The couriers union in Chicago is watching California closely, but the union doesn’t present company owners with much to worry about. It has only about 35 members, and it’s met almost total failure in recruiting drivers, who outnumber bike messengers in the Chicago workforce by more than two to one. The bikers describe themselves as individualists in their 20s who live in the moment, the drivers as older family people reluctant to stir up trouble.
“Part of the problem is the industry itself,” says veteran courier Augie Montes, a CCU leader. “There’s a lot of turnover; it’s very transient. We’ve got folks who don’t really believe things can change. It’s so hard to think of being involved in this industry over the long term. You get to a point that you start feeling you’re never going to get a fair shake.”
In July 2003 a messenger rally had Mike Morell biking from San Francisco to Portland to Seattle. He came back to Chicago exhausted but with a plan. In Portland he’d crashed with the members of the Magpie Messenger Collective, founded in 2002 by Meghan Mack. A Portland native, she’d spent a decade in San Francisco, where she’d founded the Cupid Courier Collective, the first group of its kind in the country. “You’re the one who has the relationship with the clients, in their offices every day,” she reasons. “You’re the one who has to keep the customer happy. It’s not that hard of a business to run. So why not run one yourself?”
Morell had left Portland asking himself the same question. By then he’d been at On Time for about six months, and even though it classified him as an employee, he was annoyed that he couldn’t get a weekly commission report. “I had no idea how many runs I did, how much I made for each run. I had no way of checking up on them,” he says. “That doesn’t mean they were trying anything shady. But various bikers at various times had asked for commission reports, and they basically said, ‘Well, you should find a new job at a service that has commission reports.’
“In San Francisco and Portland, even some of the noncollectives were owned by former couriers who still had their interests in mind. There wasn’t anything like that that I could point to in Chicago.” Compared to messengers out west, Morell felt powerless.
He didn’t want to leave messengering. But he’d invested a couple of years in “building community” and, to his mind, had largely failed. So instead of trying to help every messenger in Chicago, he decided to focus on helping himself. His solution was the collective: “Here was a way to immediately make this job the way I wanted it to be.” Morell has since distanced himself from the couriers union. “When I started working on the co-op–that became my new union of five people.”
All five members had been involved to some degree with the Windy City BMA and the Chicago Couriers Union. Cudal and Greenberg ate brunch together every Sunday and talked about starting a business, and soon Morell was part of the conversation. Korby and McLaughlin were recruited: “They’re both dedicated couriers,” Morell said. “We didn’t have to worry about them not pulling their own weight.”
Everyone put up $400 and they opened a bank account. They got an attorney through the Small Business Opportunity Center of Northwestern University, which provides cheap or free legal counsel to promising start-ups and nonprofits. They spent $500 to incorporate as a limited liability corporation and $200 on brochures. They got a hand-me-down desktop from someone’s dad. They bought liability insurance with a $1,200 down payment, and they applied for licenses. They sent out feelers to potential clients.
And one by one, they quit their jobs.
“It’s a scary thing,” Cudal said at the time, “because there are people who’ve said to us, ‘Oh, that sounds great.’ But when the time comes, they might say, ‘Nah, we’re all right with the messenger service we’ve got.'”
“Unrivaled messenger services . . . competitive prices . . . over two decades of experience,” said the 4 Star brochure. “Most courier companies pit messengers against each other. . . . As a result, [they] are forced to concentrate on the quantity of their deliveries at the expense of the quality of their service. . . . When you messenger a package through 4 Star, you know it will be delivered by a courteous and capable courier who loves their job.”
The first company the collective pitched was the one that produced the brochure. Mid-American Printing Systems was good for up to 20 tags per day, enough to put 4 Star on its feet financially if not quite into the black. The five friends thought they had this one in the bag. Secretaries and receptionists and office managers are the people messengers interact with. Sometimes they even decide whether to hire or fire a courier service. McLaughlin and Korby had delivered countless packages to the receptionist at Mid-American Printing for On Time. They knew her and felt that they’d clicked with her.
On Time’s Michael Carey points to the raid on Mid-American Printing as evidence of his former couriers’ perfidy–he says Cudal had promised him that 4 Star wouldn’t go after his clients. Cudal says there was no such pledge; how else would they attract business but by approaching other services’ customers? Even so . . . “There is a tinge of guilt,” Morell says. “I worked with Mike for three years. We were all kind of friends.” He adds after a moment of thought, “He got his start the same way.”
The Mid-American campaign turned out to be what Morell would call a “learning experience.” Korby and McLaughlin were the pitchmen. They put on shirts with buttons, ordered their hair, and prepared a set of talking points–happy workers, better service. They made their pitch to the owner, the shipping manager, and the plant manager–no receptionist. “We’ll get back to you,” said the Mid-American brass when the meeting was over. They didn’t.
Mid-American is solicited so often by courier companies that plant manager John Pedersen has trouble keeping them all straight. But he remembers the two 4 Star couriers going on about the idea of a collective. “I thought it was a good idea,” Pedersen says. “I got nothing against entrepreneurship.” But he wasn’t swayed. “The swaying part comes with service and price. It don’t matter how they run it.” 4 Star was offering rates “comparable” to its competitors’, and that wasn’t enough. “We’re happy with On Time. If you give good service and if you’re consistent, you got no problem with us. . . . Someone would really have to screw up for us to want to make a switch.”
Morell and the others realized that they’d failed with Mid-American because they pitched their big ideas over the bottom line. They needed to go into future meetings armed with spreadsheets demonstrating how much money a shift to 4 Star could save the client. But this was an idea they still found distasteful. Undercutting competitors might incite a price war and diminish the commission-based livelihoods of old comrades in arms. As Korby put it, “We want our customers to want us for our service, not our price.”
But if the collective structure had one thing going for it, it was low overhead. They paid $200 a month to rent office space in the living room of McLaughlin’s apartment in Pilsen. (After several months they moved into the front room of the downstairs neighbors’ apartment. These tenants were bike couriers.) They paid $300 a month for insurance. They paid $300 to Nextel for five two-way cell phones. They paid AT&T for a landline. Aside from office supplies and bike maintenance, their operating expenses were almost all fixed costs. They had, in other words, room to move.
They figured they’d need 80 tags a day to pay the bills and give each member of the collective $500 a week. But during the first few weeks and months of operation, 20 tags a rider might as well have been the moon. Their squeamishness about price wars began to evaporate. Wasn’t their concern a bit abstract anyway? “If I really thought that this was going happen–that we would drive rates down for the rest of the industry–I’d think again about doing it,” Morell said. “But we’re not going after that many clients, so I’m not sure it would make any difference industry-wide.” They began debriefing their courier friends. “That way,” Morell said, “we have a general idea what the competition is charging, and we can offer a little less.”
How much less? “As little less as possible. I think we could undercut far more than we do. But we have amounts we won’t go below. Philosophically, we don’t believe that it’s right to charge below a certain line. At some point you say, ‘No good biker would deliver a package for that amount of money.'”
He didn’t want to say much about 4 Star’s pricing–which, like any other courier service’s, varies from customer to customer–but he estimated that a company putting out 15 tags a day might save $1,000 a year. “It’s a pretty impressive number,” Morell said. “At least to me it is.”
In late September, 4 Star made its first sale. When the call came in from Post Effects, a company that makes marketing videos and audio recordings for ad agencies and other corporate clients, the partners cheered and high-fived. As with Mid-American, this had been an On Time client and friendships were involved, but this time the sales pitch focused on price. Josh Korby received the honor of handling the first tag, and he sprinted down Michigan Avenue. “I couldn’t stop smiling. I passed the dude who took my place at On Time and I dusted his ass. He looked lost out there. It must have been his first day.”
“They offered us the better deal,” says Michelle Piccolo, the office manager. “It wasn’t supercheap, it wasn’t dirty cheap, but it was significant enough to make a difference to us.”
The victory was largely symbolic–Post Effects puts out at most four tags a day. More than a month passed before Michael Carey even realized that 4 Star had poached an On Time client. But when he did, On Time mounted a countercampaign that included a cake delivered to the Post Effects office. “Which we appreciated,” Piccolo says. She says On Time asked her to name her price. 4 Star then decided collectively on a counteroffer, so low that their victory was not only symbolic but Pyrrhic. “It was our Vietnam,” says McLaughlin.
Piccolo says that so far she’s been impressed. “We’re very happy with 4 Star. At first I was concerned. There’s only five of them–would that be a problem? As it turns out, it’s not a problem at all. We get approached by courier services all the time–CMS, Velocity. We have no desire to change.”
By mid-October 4 Star had six clients. They were doing four or five runs and bringing in about $25 a day. They drained their collective and personal bank accounts. McLaughlin got a job baking bread at Bleeding Heart Bakery. Josh Korby deferred his student loans and took a weekend job at Upgrade Cycle Works, in the same building as On Time. Jen Greenberg took a night job at Starbucks. Cudal and Morell, with their highly developed sense of thrift, weren’t moonlighting yet but they’d started to think about it. “We all had that ‘what have we done?’ sort of shock,” says Morell.
They solicited nearly a hundred prospects and slowly, incrementally, business increased–a small law firm, another printing company, a member of an architectural co-op attracted to 4 Star’s collective model. They networked: a friend’s uncle, an owner of Fox & Obel, referred them to a law firm he’d worked with, Schwartz Cooper. The LaSalle Street firm, with 90 attorneys on four floors, was a faithful Arrow customer but agreed to give 4 Star its overflow.
Toward the end of October the collective passed out 4 Star brochures to around 600 cyclists assembling in Daley Plaza for a Critical Mass ride. T.C. O’Rourke, circulation manager of Time Out Chicago, happened to be there too, looking for couriers to deliver copies downtown; a few days later a deal was struck over beers. Now Korby spends every Wednesday morning and afternoon hauling 900 magazines on a five-and-a-half-foot-long trailer hitched to his bike. By itself the Time Out business covered 4 Star’s costs, lifting their revenue to $70 a day.
Around Thanksgiving they got another big break. An ex-messenger pal working at a law firm had heard that a printing company the firm used, Award/Vision Integrated Graphics, was looking for a courier service. With 20 to 30 tags per day, Award/Vision immediately became 4 Star’s biggest customer, accounting for 90 percent of its business. “The hole we dug for ourselves is all of a sudden a lot shallower,” Morell said. The collective continued to build its client base, and by spring its weekly revenue was over $2,000, about half from Award/Vision. The members were paying themselves $250 at the end of each week. They were halfway to their goal.
One day in November McLaughlin, working alone in his apartment as dispatcher, took a phone call. The caller said he was a city inspector, and that he was calling him on a cell phone from the street below. He didn’t ask McLaughlin to come down, and he didn’t ask to be invited up. He said the city had received four complaints, though he wouldn’t say from whom and he wouldn’t describe their nature. He asked a single question: “Are there a lot of people coming in and out of the apartment?”
The inspector said that if 4 Star continued operating without a home-occupation license, it should expect to receive a citation.
The collective members couldn’t figure it out: the business was just one person answering phone calls, and most of the “work” took place downtown, so why would anyone complain?
They asked the neighbors. Downstairs, upstairs, across the street, and next door, the neighbors proclaimed their innocence.
“This is complete conjecture,” Morell said, “but we think someone who didn’t want us in business called the city multiple times–another messenger service whose clients we were soliciting.”
The next day McLaughlin went down to City Hall to find out what a home-occupation license was. According to the city code, if a business operates out of a residence it can employ only one person in addition to the owner, and it needs a special license. McLaughlin attempted to explain the concept of the collective–4 Star had no employees, and only one person, not two, worked in the apartment at any given time.
So how many people work for your business? the clerk asked.
McLaughlin filed an application, and for four months 4 Star heard no more about it.
But other regulatory quandaries were developing. A courier service in Chicago needs at least two separate licenses to operate, and in the collective’s case it was three, the home-occupation license being the third. Since its inception, 4 Star had had a straight-up business license. But it didn’t have its bicycle messenger service license, which required a good deal more than an annual $70 fee. It required liability insurance, which 4 Star had, and workers’ compensation insurance, which it didn’t.
A week before opening for business, the collective had submitted a bike messenger license application sans proof of workers’ comp coverage. “Not applicable,” they wrote on the line asking for it. They’d priced plans, which for a five-person outfit would run $20,000 to $30,000 a year, but reasoned that because the five partners did all the work with no hired help, they could ignore the requirement.
There were ironies here. The collective model offered the same competitive advantage as reclassifying workers as independent contractors and hiring NICA to take over payroll: it reduced overhead. “The collective thing is probably a slick way to beat workers’ comp,” says the owner of another courier service. “Normally, workers’ comp is a humongous cost hurdle to overcome in starting a business. Ours just shot up 25 percent this year. It costs over 10 percent of our gross sales, easily.”
A series of city clerks refused to accept 4 Star’s application. They reasoned that if messenger companies need workers’ comp insurance and 4 Star was a messenger company, 4 Star needed workers’ comp insurance. The collective’s attorney cited state law–sole proprietors and partners and LLC members need not be covered by workers’ comp. The clerks passed the matter up to a midlevel official in the Department of Consumer Services. Weeks passed. Phone calls to the official were not returned. Survival pushed the issue to the back burner.
In late April a start-up design shop in need of a courier service left a handwritten note on the gate to the collective’s building. That seemed strange. Stranger still, the shop gave Bank One Plaza as its address.
When two of the designers showed up at 4 Star’s headquarters, Morell was on duty as dispatcher. Between phone calls he gave them his spiel.
One asked, “Are you fully insured?” Morel rummaged through a filing cabinet and handed over 4 Star’s liability policy.
“Do you guys have a license?”
Morell rummaged some more and presented 4 Star’s articles of incorporation and its basic business license.
“But what about a messenger license?”
Morell looked up from his two-way. He hedged. “We filed the application with the city. The ball’s in their court. We’re on the right side of the law.”
The designers, who were in fact city inspectors, flashed their badges and scribbled out three tickets: one for operating without a messenger license, another for operating without a home-occupation license, a third for having no proof of insurance on file with the city. Then one said, “We also have to give you cease-and-desist orders.”
Morell’s thoughts were racing: “Like, this is done. What now? Apply to grad school?” He called McLaughlin, who headed to Pilsen. They called their lawyer, assembled their paperwork, and went to City Hall, where they refiled their applications for their home-occupation and messenger licenses.
The first one turned out to be easy. As for the messenger license, that old bugaboo, they heard the same circular logic. They worked their way up the chain of command of the Department of Consumer Services, and after six or seven phone calls reached Rosemary Krimbel, the deputy commissioner and general counsel.
On the phone, Morell presented the usual argument–this is a partnership without employees. And Krimbel said, “Wait. You don’t have any employees?”
It was the first time 4 Star had sensed that spark of recognition from a city official. Krimbel asked them to re-reapply and to be sure to include a statement, reviewed by their lawyer, that explained the legal basis for their worker’s-comp opt-out.
Krimbel says 4 Star was in the right but adds that “they have to understand what their liabilities are. The state law doesn’t require workers’ comp if you don’t have employees. That doesn’t mean, however, that they can’t be sued for workers’ comp by one of their partners.”
Three days after the sting operation, 4 Star finally had its messenger license.
The collective still had to deal with the three tickets. On May 8, Morell put on a shirt and tie and went to an administrative hearing. He settled with the city on penalties totaling $525. The alternative was to fight the violations in court, on the premise that the collective had been legal from the start and that if the city would’ve returned its phone calls the matter could’ve been resolved in September. But to fight would be to risk losing, and to lose would mean paying fines in excess of $10,000. Morell took out his checkbook.
May brought other bad news. Jack McLaughlin decided to leave the collective. “More or less I just burned myself out physically and mentally,” he says. “I felt it every day when I got home. I was completely beat. I just couldn’t handle it anymore.” He turned 32 Wednesday. “It has nothing to do with the collective. I want them to succeed, which I know it will, and I can see it is. I just don’t want to bring it down because I’m not giving 100 percent.” For now he’s working at the bakery and doing mixed-media art. He hasn’t figured out what’s next.
For the time being, 4 Star is operating with three riders and a dispatcher in Pilsen. Greenberg no longer works at Starbucks. The collective is now handling about 50 tags per day and continues to add business, though they sometimes worry that they’re not looking for it hard enough–Morell thinks they should approach Mid-American again and try to tempt Schwartz Cooper into giving them more lucrative runs. In a couple months they might need to replace McLaughlin–and if they decide to, they might find themselves with a fairly wide pool of applicants.
One April evening the collective gathered after work at the Handlebar. McLaughlin said he’d gotten a call from a courier friend who asked him, with some frustration, “Aren’t you guys hiring yet?” Greenberg said she was approached by a messenger who’d seen Korby racing down the street, a package in his bag. “Josh looked pretty stressed out there today,” the messenger said. “If you guys need any help, I’m here.”
Greenberg, still involved in the couriers union, said she’d picked up on a common theme at the meetings: “It’s almost become a joke,” she said. “If someone’s having a bad day or having problems with their boss, they’re like, ‘The hell with it. I’m going to 4 Star.'”
Korby set down his beer and laughed. “Get your own company,” he said.
Art accompanying story in printed newspaper (not available in this archive): photos/Jon Randolph.